Office of Local Government v Councillor Campbell of Murray Shire Council

The Land and its potential development

This matter concerns an irregularly shaped 5807 m2 block of largely undeveloped land in Moama, being Lot 1/DP 851678 (the land). It is common ground that at all relevant times Councillor Campbell was the registered proprietor (in her previous surname of 'Canfield') of the land. The only building on the land presently is a pump shed. Two sides of the land abut public roads, one abuts a property where there is an existing brick residence, and the fourth boundary is uneven, and abuts Crown land which in turn extends to the top of the bank of the Murray River (the top of the bank).
The relationship between the land and the top of the bank is important. In essence this is because, as the law stood when Councillor Campbell made a development application in 2012, construction of a new residence could not be approved by the Council if the residence was within 100 metres of the top of the bank. This is the result of the following environmental laws.
The Murray Local Environmental Plan 2011 (the LEP) is made under the Environmental Planning and Assessment Act 1979. It is common ground that it applies to the land and that the land is zoned E3. Under the LEP, land zoned E3 is to be protected, with only a limited range of development permitted.
Subclauses 7.4(1) and (2) of the LEP provide: 7.4 Development on river front areas (1) The objectives of this clause are as follows: (a) to support natural riverine processes, including the migration of the Murray and Wakool Rivers' channels, (b) to protect and improve the bed and bank stability of those rivers, (c) to maintain and improve the water quality of those rivers, (d) to protect the amenity, scenic landscape values and cultural heritage of those rivers and to protect public access to their riverine corridors, (e) to conserve and protect the riverine corridors of those rivers, including wildlife habitat. (2) Despite any other provision of this Plan, development consent may only be granted to development on land in a river front area for the following purposes: (a) boat building and repair facilities, boat launching ramps, boat sheds, charter and tourism boating facilities or marinas, (b) the extension or alteration of an existing building that is wholly or partly in the river front area, but only if the extension or alteration is to be located no closer to the river bank than the existing building, (c) environmental protection works, (d) extensive agriculture and intensive plant agriculture, (e) environmental facilities and recreation areas, (f) water recreation structures.
"River front area" is defined in the LEP as: (a) in Zone RU5 Village, Zone R1 General Residential, Zone R2 Low Density Residential, Zone R5 Large Lot Residential, Zone SP3 Tourism and Zone B2 Local Centre-the land within 40m of the top of the bank of the Murray or Wakool River, or (b) in Zone RU1 Primary Production, Zone RU3 Forestry and Zone E3 Environmental Management-the land within 100m of the top of the bank of the Murray or Wakool River. (emphasis added).
Thus, land in a river front area may not have development consent granted for a new residence as such a development is not one listed in Clause 7.4(2).
Finally, the Murray Development Control Plan 2012 provides for a residential building set back objective for 'rural land', which includes land zoned 'environmental management E3' Zone, of a minimum of 10 metres from any boundary.
Where, as here, the land was zoned E3, a development consent for a new residence could thus not be granted in so far as the proposed residence was within: 1. 100 metres of the top of the bank of the Murray River; 2. 10 metres of any boundary.
On 14 December 2012, Councillor Campbell lodged a development application over the land: DA 115/13 (the DA). The DA attached a site plan for a proposed residence and a shed. The proposed residence was to be substantial: four bedrooms with underground car parking. The notice of environmental effects lodged by Councillor Campbell's civil and structural engineer stated that the residence would be set back 20 metres from each adjoining public road and set back 'more than 60 metres' from the top of the bank of the Murray River. The Council then began its assessment of the DA.
On 26 April 2013, in response to a request from Councillor Campbell for more time to gather information previously sought from her by the Council in relation to the DA, a town planner sent an email to her which stated: In respect to the requested information, in light of recent legal advice received by Council it is strongly recommended that Clause 7.4(2) - development on river front areas of Murray LEP 2011 be considered when preparing the further information as this could impact upon the permissibility and/or siting of the proposed development.
On 29 November 2013, the concerns there mentioned were made clear, as was a possible solution, in a letter from the Council's Manager of Planning and Building to the respondent, which stated: … there remains [sic] two outstanding issues for your consideration prior to the application being assessed and determined. The submitted site plan suggests that the proposed dwelling is located within a 'river front area' which is defined under Murray LEP 2011 as being Zone E3 Environmental Management - the land within 100 m of the top of the bank of the Murray River. Dwelling houses are not permitted on 'river front areas' as per Clause 7.4(2) of Murray LEP 2011 and therefore Council cannot consent to the erection of a dwelling in the proposed location. However, it is proposed that Council will consider amendments to the subject definition in the near future and should you desire, Council is willing to consider deferring the assessment of the application until after these amendments have been considered.
The 29 November letter makes it clear that the proposed residence, in the view of the Council, was within 100 m of the top of the bank, but that the clause 7.4(2) definition was shortly to be considered for amendment by the Council.
That is indeed what came about on 10 December 2013, when the Council resolved that the 'river front area' definition concerning the 'E3 Environmental Management' zone should be amended from '100 m' to '60 m', and that this resolution be incorporated in a planning proposal to be submitted to the Department of Planning and Infrastructure with a request to amend the Murray LEP in that way.
Councillor Campbell could have chosen to make a declaration of her interest and to absent herself from the meeting. Instead, she made no declaration and was present and voted in favour of the amendment. The question for the Tribunal is whether that resulted in a contravention of the Act. I now turn to the relevant provisions.

Consideration - Was there a pecuniary interest?

It is necessary for the Applicant to establish that Councillor Campbell's ownership of the land coupled with the unresolved DA as at the date of the matter, namely the Council's consideration of the resolution to change the LEP's definition from 100 to 60 metres, comprised: 1. An interest that she (s 443) had in that matter because of a reasonable likelihood or expectation of appreciable financial gain or loss to her, which: 2. Was not so remote or insignificant that it could not reasonably be regarded as likely to influence any decision she might make in relation to the matter; nor did it 3. Fall within one of the exceptions in s 448.
The position, as set out above, was that the Council had advised Councillor Campbell that the DA she had lodged to build a residence on her own land could not be approved under the current terms of the LEP as the residence was within 100 metres of the top of the bank, but that this impediment was shortly to be the subject of consideration by the Council to ask the Department of Planning to effect an amendment to the LEP.
The evidence in this Tribunal included a valuation report dated 5 August 2014. There was no forensic challenge to its conclusion that the market value of the land without a dwelling permit, that is to say, without a residence, was $150,000, and the value of the land with a dwelling permit was $450,000. I find that a potential gain in market value of $300,000 would be an "appreciable financial gain" which was not "so remote or insignificant" that it could not reasonably be regarded as likely to influence any decision she might make in relation to the matter. That is a significant amount of money: objectively, it might be thought likely to influence a decision by a Councillor.
Furthermore, the land once developed in accordance with the DA would then be able to be rented as a residence, and would provide an income stream. It may be, as Councillor Campbell indicated in her record of interview with officers of the applicant, that she could put the land to another use. However, she was not proceeding with the DA for no reason. Evidently, she saw the DA as an opportunity to increase both the land value and the earning potential of the land.
Although the Council could not itself effect the change in definition of clause 7.4(2), but only petition the Department for that change, that circumstance does not of itself make the interest so remote that 'it could not reasonably be regarded as likely to influence any decision the person might make in relation to the matter' as the Council was doing everything it could lawfully do to obtain the change.
None of the exceptions in s 448 applied. Only s 448(g) is of any possible relevance, although this matter did involve 'an interest in a proposal relating to the making, amending, altering or repeal of an environmental planning instrument', that exception cannot apply as the instrument, if made, 'effects a change of the permissible uses of' the land in which Councillor Campbell has a proprietary interest.
Mr Hill, for Councillor Campbell, expressly did not rely upon s 457. In view of the letter from the Council of 29 November 2013, it would not be possible to make out that exception.
Finally, there was no reliance upon s 451(4), no doubt for the reason that no special disclosure as required by s 451(4)(b) was ever made.
Much of the submissions made by Councillor Campbell centred upon: 1. Whether the proposed residence was in fact within 100 metres of the top of the river bank, but that if it was; 2. Whether it was theoretically possible to re-design the plan to have a residence which was both more than 100 metres from the top of the river bank and 10 metres from the other boundaries.
Although, as explained below, the answer to the first question is 'yes' and the second is 'no' the Tribunal does not consider that this ultimately matters in determining whether there was a pecuniary interest which transgressed the provisions of the Act. The reason for that is that: 1. A particular DA had been lodged; 2. The Councillor had been told that the 100 metre rule precluded approval of that DA as lodged but that if the Councillor wished; 3. Consideration of the DA could be deferred pending consideration by Council of what emerged as the 60 metre proposal; and 4. The lodged DA specifically noted that the residence was more than 60 metres from the top of the river bank.
It was in those circumstances that Councillor Campbell voted for introduction of a 60 metre rule. (There was no evidence an amended DA was ever lodged seeking to comply with the two restrictions referred to in the last paragraph.) Those circumstances amount to voting on a matter giving rise to a reasonable likelihood or expectation of appreciable financial gain
If the Tribunal is wrong as to this, the following findings are made. The Council chose not to obtain a formal surveyor's report. Nevertheless, attached to the investigation report was a surveyor's plan setting out the boundaries of the land and the location of the proposed residence, and what is described as the approximate location of the top of the bank of the Murray River 'subject to survey'. An officer of the Council sent a facsimile to the applicant which stated that measurements based on the plan showed that the distance from the proposed residence to the top of the bank was approximately 60.74 m. It also showed that the distance from the south side of Forbes St to the top bank was 100 m, the distance from the north side of Forbes St to the top bank was 113 m, and the distance from the north side (20 m in) to the top bank was 108.15 m. That last reference to 20 m referred back to the statement of environmental effects by the respondent's town planner, which said the residence would be set back approximately 20 m from Forbes and Ward Streets. Those documents, which were prepared by those acting for Councillor Campbell, clearly show the proposed residence was within 100 metres of the top of the river bank. No expert evidence was called by Councillor Campbell, and Mr Hill was not able to demonstrate by way of submission or by reference to the large scale 'Crown Account Search' map, that it would be possible to construct a residence of any sort let alone one the size of that proposed in the DA, without falling foul of the 100 metre rule as well as the 10 metre set back standard. Further, seeking to tender plans for a house approval by some other person over some other block of land without any detail as to the circumstances, proves nothing of relevance.
Conclusion
In the result, although Councillor Campbell had lodged a written general disclosure of her land interests in July, which included reference to the land, as her interest in the land in all of the circumstances was a pecuniary interest within the meaning of s 442 of the Act as at 10 December 2013, she was required to: 1. Disclose that interest to the particular Council meeting in question 'as soon as practicable': s 451(1); 2. Neither be present or in sight of the meeting when the matter was being considered, discussed or voted on: s 451(2); and thus 3. Not vote on the matter.
Having done none of those matters, but rather attending and voting in favour of the amendment, the applicant has made out its case that Councillor Campbell has breached the Act. The question now is what orders should be made. The parties should have an opportunity to consider these reasons. The applicant has, in its written submissions, already made submissions as to the penalties it seeks. It may be that the parties wish to adduce further evidence in relation to penalty. Depending upon the type of evidence sought to be adduced and the views of the parties, it may be that the question of penalty can be dealt with on the papers. However, if for example, the respondent wished to give evidence, then it would be necessary for a further hearing to be held.
The directions made as to the future conduct of the proceeding are that: 1. Within 21 days of publication of this decision, the respondent is to file with the Tribunal and serve on the applicant, any evidence including evidence from the respondent, that she seeks to rely upon, and an outline of submissions as to the question of penalty; and 2. Within 42 days of the publication of the decision, the applicant is to file and serve any evidence and submissions in reply.
Once those orders have been complied with, the Tribunal will then consider whether the matter can be dealt with on the papers or whether the matter needs to be relisted for further hearings. Legal practitioners for the respective parties therefore should advise the Registry of convenient dates in 2016 for any hearing which may be required in relation to penalty. I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar

At a glance

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Judgment (7 paragraphs)

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Legislation Cited (3)

Cases Cited (4)

Cited By (10)