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[2026] NSWLEC 1133
General information, not legal advice.
Land and Environment Court (NSW)
2026-03-17
Espinosa C
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: One Playground (M & E) Pty Ltd v Inner West Council [2026] NSWLEC 1133
Hearing dates: Conciliation conference held on 25 and 27 February 2026
Date of orders: 17 March 2026
Decision date: 17 March 2026
Jurisdiction: Class 1
Before: Espinosa C
Decision: The Court orders that:
(1) The appeal is upheld.
(2) Pursuant to s 8.15(3) of the Environmental Planning and Assessment Act 1979 (NSW), the Applicant is to pay the Respondent’s costs thrown away as a result of amendment of the development application in the quantum of $8,000.00 within 28 days of these orders, as agreed or assessed.
(3) Development application number DA/2024/0655, for the demolition of all unauthorised structures (including, but not limited to, demolition of the existing mezzanine level, glazed auto doors to Shepherd Street and unauthorised partition walls); construction of a mezzanine level, minor alterations and additions to the existing building, fit out and use of Tenancy K as an indoor recreation facility (gym), installation of business identification signage on land legally identified as Lot 4 in Deposited Plan 785028 and known as “Tenancy K” at 14 Rich Street, Marrickville is determined by the grant of development consent, subject to the conditions at Annexure A.
Catchwords: DEVELOPMENT APPEAL — change of use for indoor recreation facility — business identification signage — demolition of unauthorised structures — alterations and additions to existing building — conciliation conference — agreement between the parties — orders
Legislation Cited: Environmental Planning and Assessment Act 1979 (NSW), ss 2.22, 4.16, 8.7, 8.15, Sch 1
Land and Environment Court Act 1979 (NSW), s 34
Environmental Planning and Assessment Regulation 2021 (NSW), ss 23, 35B, 38
Inner West Local Environmental Plan 2022, cll 2.7, 4.3, 4.4, 4.5, 4.6, 5.10, 6.1
State Environmental Planning Policy (Industry and Employment) 2021, ss 3.1, 3.6, Sch 5
State Environmental Planning Policy (Resilience and Hazards) 2021, s 4.6
State Environmental Planning Policy (Sustainable Buildings) 2022, Ch 3, s 3.1
Cases Cited: Wehbe v Pittwater Council [2007] NSWLEC 827
Category: Principal judgment
Parties: One Playground (M & E) Pty Ltd (Applicant)
Inner West Council (Respondent)
Representation: Counsel:
J Strati (Solicitor) (Applicant)
J Marsland (Solicitor) (Respondent)
Solicitors:
P & D Legal (Applicant)
Apex Planning and Environment Law (Respondent)
File Number(s): 2025/88343
Publication restriction: No
COMMISSIONER: This is a Class 1 Development Appeal pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) being an appeal against the refusal of Development Application DA/2024/0655 seeking consent for the fit out and use of existing premises as an indoor recreation facility (gym) operating 5:00am to 10:00pm 7 days a week, and the installation of business identification signage (Proposed Development) at 14 Rich Street, Marrickville legally described as Lots 2 and 3 in DP 785027, Lot 4 in DP 785028 and Lot C in DP 178259.
The Court arranged a conciliation conference under s 34(1) of the Land and Environment Court Act 1979 (NSW) (LEC Act) between the parties, which has been held on 25 and 27 February 2026. I presided over the conciliation conference.
At the conciliation conference, the parties reached agreement as to the terms of a decision in the proceedings that would be acceptable to the parties. This decision involved the Court upholding the appeal and granting development consent to the development application subject to conditions.
Under s 34(3) of the LEC Act, I must dispose of the proceedings in accordance with the parties’ decision if the parties’ decision is a decision that the Court could have made in the proper exercise of its functions. In making the orders to give effect to the agreement between the parties, I was not required to, and have not, made any merit assessment of the issues that were originally in dispute between the parties.
The parties’ decision involves the Court exercising the function under s 4.16 of the EPA Act to grant consent to the development application.
There are jurisdictional prerequisites that must be satisfied before this function can be exercised. The parties identified the jurisdictional prerequisites of relevance in these proceedings to be the terms of s 3.6 of the State Environmental Planning Policy (Industry and Employment) 2021 (Industry and Employment SEPP) regarding business identification signage and various terms of the Inner West Local Environmental Plan 2022 (IWLEP). The parties explained how the jurisdictional prerequisites have been satisfied and I summarise that explanation below.
From 8 August 2024 to 29 August 2024, the DA was publicly notified by the Respondent in accordance with the community participation requirements of s 2.22 and Schedule 1 of the EPA Act. Thirty-eight (38) unique submissions were received. Four oral submissions were heard at the earlier s 34 conciliation conference on 25 July 2025 before Harding AC. The conciliation conference was adjourned until 12 August 2025 and again until 4 September 2025. The s 34 conciliation conference was terminated on 4 September 2025. Oral submissions were also made by objectors at the conciliation conference on site on 25 February 2025. The written and oral submissions have been taken into consideration by the Respondent.
Without prejudice material was provided by the Applicant to the Respondent on a number of occasions and a site inspection to the Site, including to an unauthorised mezzanine level, was accommodated on 2 December 2025.
The Applicant seeks to amend the DA including by limiting the Proposed Development to what is known as Tenancy K at Lot 4 in Deposited Plan 785028 (the Site) which is existing warehouse building and car park with a street address of 14 Rich Street, Marrickville. That street address also includes land legally identified as Lots 2 and 3 in Deposited Plan 785027 and Lot C in Deposited Plan 178259. The Site is also known informally by the parties as 67 – 72 Shepherd Street, Marrickville because the Site itself does not have a frontage, or direct access, to Rich Street. The Site is a corner allotment with a 27m frontage to Chapel Street and a 30m secondary frontage to Shepherd Street.
An existing car park is located to the rear of the Site, accessed via Shepherd Street. Historically, the car park was shared between the three tenancies in the existing building. On 6 November 1996, the then Marrickville Council determined development application D 238/96 for the division of the existing industrial building into three (3) tenancies for three (3) separate industrial purposes by way of consent, subject to conditions (Determination No. 16808) (1996 Consent).
The parties have reached agreement in relation to an amended Application and agree that the amendments resolve all issues in dispute. As part of the agreement reached between the parties, the carpark will form a part of Tenancy K, and be used exclusively by patrons of the Site. In reaching the terms of this agreement, the Applicant has agreed to amend the description of development and to surrender the 1996 Consent by way of a deferred commencement condition.
Specifically, the Proposed Development involves the following:
Demolition of all unauthorised structures on the Site including, but not limited to, demolition of the existing mezzanine level, glazed auto doors to Shepherd Street and unauthorised partition walls,
construction of a mezzanine level, minor alterations and additions to the existing building,
fit out and use of Tenancy K as an indoor recreation facility (gym),
installation of business identification signage.
The Applicant has a leasehold interest in the Site and landowner’s consent is at Tab 4 of the Class 1 Application filed with the Court pursuant to s 23, Environmental Planning and Assessment Regulation 2021 (NSW) (EPA Regulation).
The Site is within the E3 Productivity Support zone (E3 Zone) pursuant to the IWLEP and Recreation facilities (indoor) are permissible with development consent in the E3 Zone. Demolition is permitted with consent pursuant to cl 2.7 of the IWLEP.
The existing building is less than 12m which complies with the 20m height of buildings development standard that applies to the Site pursuant to cl 4.3 of the IWLEP.
The Proposed Development is subject to a floor space ratio (FSR) development standard of 1:1 pursuant to cl 4.4 of the IWLEP to be calculated in accordance with cl 4.5 of the IWLEP. The Proposed Development exceeds the FSR development standard having an FSR of 1.087:1 or an 8.7% exceedance of the development standard. The total proposed Gross Floor Area has been calculated with reference to the approved floor area for the Site, as established by the 1996 Consent and the total GFA is calculated to be 6,519.26m2 which equates to an FSR of 1.087:1. All areas of proposed floor area across the Site have been included in the GFA calculation except for the following:
Car parking in the northeast corner of the site with a total area of 125m2; and
Unbuilt ground in the northwestern corner of the site with a total area of 57.54m2.
I accept that the proposed variation to the FSR development standard relates to a minor numerical exceedance arising solely from internal reconfiguration within an existing building envelope without giving rise to any adverse environmental or amenity impacts.
The Applicant relies on a written justification that has been prepared by Architectus dated 26 February 2026 which addresses cl 4.6(3) of the IWLEP and s 35B of the EPA Regulation. The written justification demonstrates at pp 13 and 14 that:
compliance with the standard is unreasonable or unnecessary in the circumstances because the Proposed Development achieves the objectives of the FSR development standard notwithstanding numerical non-compliance (Wehbe v Pittwater Council [2007] NSWLEC 827 at [43]-[48]); and
there are sufficient environmental planning grounds to justify the non-compliance, including the orderly and economic use of the land by way of adaptive reuse and increased economic viability of a building with a heritage overlay.
Clause 5.10(4) of the IWLEP requires the consent authority to consider the effect of the Proposed Development on the heritage significance of the item or area concerned. The following heritage items are relevant:
The “industrial façade” of the Existing Building along Chapel Street is identified as a local heritage item (I1277) pursuant to Part 1 of Schedule 5 of the IWLEP;
The Site is adjacent to Sims Metal Factory at 61 – 65 Shepherd Street, which is a local heritage item, including interiors (I1280);
The Site is directly opposite Marrickville Public School located at 116 Chapel Street, which is a local heritage item, including interiors (I1218).
The heritage impact of the Proposed Development has been assessed as set out in the Heritage Impact Statement (HIS) prepared by Tonkin Zulaikha Greer Heritage (Rev 2) dated October 2024 at Tab 8 of the Class 1 Application. The HIS recommends approval for the following reasons at p 90:
“The proposal retains and adapts the existing industrial warehouse building on the site, with alterations and additions, respecting the site’s historical associations with past industrial uses within the Marrickville area.
The heritage listed industrial façade, with its decorative header and dentil courses, is retained and conserved to minimise heritage impacts.
The proposed change to use to an indoor recreation facility, and associated alterations and additions, will give the site a vibrant new life and activate the streetscape whilst retaining a memory of the site’s industrial pas with minimal heritage impact.”
The Proposed Development does not propose any earthworks. Accordingly, although the Site is identified as being affected by Class 5 acid sulfate soils pursuant to cl 6.1 of the IWLEP, the terms of that provision are satisfied.
Similarly, the terms of s 4.6 of the State Environmental Planning Policy (Resilience and Hazards) 2021 (Resilience and Hazards SEPP) provides that the consent authority must consider if the land is contaminated and, if the land is contaminated, it is satisfied that the land is suitable in its contaminated state or will be made suitable with appropriate remediation. In addition to the fact that no earthworks or disturbance of soil is proposed, although the Site has historically been used for industrial purposes, the Proposed Development seeks consent for a fit-out of an existing premises and the provision of at-grade car parking. Therefore, in accordance with s 4.6 of the Resilience and Hazards SEPP, the Site is suitable for the Proposed Development.
The Proposed Development includes business identification signage and s 3.6 of the Industry and Employment SEPP requires the consent authority to be satisfied that:
the signage is consistent with the objectives of this Chapter as set out in s 3.1(1)(a), and
the proposed signage satisfies the assessment criteria in Schedule 5.
The Court is so satisfied after considering the proposed signage as detailed in the elevation Drawing 70100 Issue 4, the consideration of the signage in the HIS at p 60 and the assessment against the criteria of s 3.6 on pages 9 and 10 of the SEE at Tab 6 of the Class 1 Application.
Chapter 3 of the State Environmental Planning Policy (Sustainable Buildings) 2022 (Sustainable Buildings SEPP) does not apply to the Proposal, as it has an estimated cost of less than $10 million (estimated cost is $852,000): see s 3.1(1)(b) and Tab 5 of the Class 1 Application
I am satisfied that the parties’ decision is one that the Court could have made in the proper exercise of its functions, as required by s 34(3) of the LEC Act. I adopt the reasons given by the parties as set out in this judgment.
As the parties’ decision is a decision that the Court could have made in the proper exercise of its functions, I am required under s 34(3) of the LEC Act to dispose of the proceedings in accordance with the parties’ decision.
The Court notes that:
The Respondent has agreed to the Applicant amending the Class 1 Application, pursuant to s 38(1) and (4) of the Environmental Planning and Assessment Regulation 2021 (NSW), to rely on an amended Class 1 application form and the following additional and amended plans and documents.
| Architectural Plans prepared by Alkimi | | Drawing Number | Drawing Name | Issue | Date | | 002UGF | Site Plan | 07 | 12 December 2025 | | 001LUGF | Upper Ground Floor & Level 01 Demolition Plan | 02 | 4 December 2025 | | 101UGFOP | Upper Ground Floor Tenancy K | 04 | 12 December 2025 | | 101L01OP | Tenancy K Level 01 Floor Plan | 02 | 4 December 2025 | | 101RPOP | Tenancy K Roof Plan | 01 | 16 December 2025 | | 701.00 | Elevations | 04 | 17 December 2025 | | Documentation | | Document | Author | Rev | Date | | Survey | RGM Property Surveys | B | 12 August 2025 | | Amended Plan of Management | One Playground | 1 | 11 December 2025 | | Amended Town Planning | Architectus | 2 | 16 December 2025 | | Amended Waste Management Plan | MRA Consulting | 1 | 8 August 2025 | | DA Acoustic Assessment Report | Pulse White Noise Acoustics | 8 | 17 December 2025 | | Regulatory Compliance Report - BCA Assessment | Certatude | 5.0 | 16 December 2025 | | Clause 4.6 Variation Request | Architectus | B | 26 February 2026 |
The Court orders:
The appeal is upheld.
Pursuant to s 8.15(3) of the Environmental Planning and Assessment Act 1979 (NSW), the Applicant is to pay the Respondent’s costs thrown away as a result of amendment of the development application in the quantum of $8,000.00 within 28 days of these orders, as agreed or assessed.
Development application number DA/2024/0655, for the demolition of all unauthorised structures (including, but not limited to, demolition of the existing mezzanine level, glazed auto doors to Shepherd Street and unauthorised partition walls); construction of a mezzanine level, minor alterations and additions to the existing building, fit out and use of Tenancy K as an indoor recreation facility (gym), installation of business identification signage on land legally identified as Lot 4 in Deposited Plan 785028 and known as “Tenancy K” at 14 Rich Street, Marrickville is determined by the grant of development consent, subject to the conditions at Annexure A.
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Annexure A (277 KB, pdf)
Amended Plans (2.15 MB, pdf)
Amended Plan of Management (1.11 MB, pdf)
One Playground (M & E) Pty Ltd
Inner West Council [2026] NSWLEC 1133