Pitty v Bega Valley Shire Council

Land and Environment Court (NSW)|2012-05-11|Before: Sheahan J

2001] NSWCA 74 Swift v SAS Trustee Corporation [2010] NSWCA 182 Telstra Corporation Ltd v Australian Competition and Consumer Commission (No 2) [2007] FCA 493; (2007) 240 ALR 135 Tickner v Chapman (1995) 57 FCR 451; (1995) 89 LGERA 1 Tobacco Institute of Australia v National Health and Medical Research Council (1996) 71 FCR 265 Texts Cited: Macquarie Dictionary (3rd edition) Oxford Dictionary Category: Principal judgment Parties: William Pitty (First Applicant) Janet Pitty (Second Applicant) Bega Valley Shire Council (First Respondent) McDonald's Australia Limited (Second Respondent) Representation: COUNSEL: Mr D Wilson (First and Second Applicants) Mr A Galasso SC (Second Respondent) SOLICITORS: Elizabeth Fleming & Associates (First and Second Applicants) M E McMahon & Associates (First Respondent - submitting) Norton Rose Australia (Second Respondent) File Number(s): 41235 of 2011

Introduction 1Dr and Mrs Pitty have challenged an approval given by the Council for the development of a McDonald's restaurant on the western corner of the Princes Highway (Carp St) and Swan St, Bega, immediately north of, and adjacent to, their home at No. 11 Swan St. 2The first respondent Council filed a submitting appearance save as to costs on 2 March 2011, and made the contents of its file available (Exhibit A1 in 4 volumes). 3The Pittys, and their son, Hugh, were among many objectors who responded to Council's notification of the development application ('DA'). They are an elderly professional couple - he a clinical psychologist and she a teacher - who retired from Epping, with some health issues, to the Swan St home, in 1999. 4Dr Pitty affirmed an affidavit in these proceedings. He deposed that, after the Mayor called on him in early March 2011, and confirmed the rumour that a McDonald's was proposed for the land next door, he and his wife submitted various letters of objection over time, and on 26 July addressed a meeting of councillors. Their submissions primarily objected to a high density business being placed in a low density residential zone where it will have unacceptable impacts. Their particular concerns are flooding, noise, visual impact (including by the proposed acoustic fence), and overshadowing effects. Their and others' objections, submissions, and responses are to be found, mostly, in Volume C of the Council's materials (Exhibit A1). 5In the summons issued on 22 December 2011, the following relief is claimed: 1 Declaration that a development consent granted by the first respondent for the development of Lots 1 and 2 Deposited Plan 578015 as a refreshment room, namely a McDonalds Restaurant and dated 18 October 2011 and numbered 2011.0040 is invalid and of no effect. 2 Order restraining the first respondent and the second respondent from carrying out any work, including, but without limitation, the removal of trees or buildings from Lots 1 and 2. 3 Order restraining the first respondent and the second respondent from carrying out any work, including, but without limitation, the removal of trees from the reserve adjacent to Lots 1 and 2 and Swan Street, Bega in the State of New South Wales. 4 Further or other order or direction. 5 Costs. 6The relevant planning control is the Bega Local Environmental Plan 2002 (wrongly pleaded in the Points of Claim as bearing the date "2001") ('the LEP' - Exhibit A1, vol A, fols 1 - 94). 7The nominated lots of land (Lots 1 and 2 of DP 578015), comprising the subject site, are in separate ownership. They are together known as 1 - 7 Swan St, and cover an area of approximately 2,164 m². Lot 1, on the corner of Swan and Carp Streets, has been used for the purposes of a concrete batching plant and formerly for a landscape supply business. It is in the 3(a) General Business Zone under the LEP. Lot 2 has been used for residential purposes as a single dwelling, and, like No. 11, it is in the 2(a) Residential Low Density Zone. The Pitty home (No. 11), however, is on a double block and so appears to comprise Nos 9 and 11. 8It is common ground that the proposed McDonald's Restaurant is a "refreshment room", defined in the dictionary to the LEP (Exhibit A1, Vol A, at fol 89) as "a building or place, the principal purpose of which is the provision of food to people for consumption on the premises, whether or not takeaway meals are also provided and includes a restaurant, café, coffee shop and the like, but does not include a kiosk." 9The DA was dated 20 December 2010, but lodged on or about 3 February 2011, and was accompanied by a comprehensive Statement of Environmental Effects ("SEE" - See Points of Defence par 7, and the applicants' submissions, par 20). The development it proposed comprised demolition of existing buildings, site preparation and bulk earthworks, construction of a 325.7 sq m, 70-plus seat, McDonald's Restaurant (including drive-through facility), car parking for 24 vehicles, customary McDonald's signage, and landscaping. The actual restaurant building will largely sit on Lot 1. Access and egress for vehicles was proposed for the south-eastern corner of the subject site, from/into Swan St, close to the subject site's boundary with the Pitty land, and largely on Lot 2. 10The application came before the Council on 26 July, 27 September and 18 October 2011. The Council officers recommended refusal, but the proposal was amended, and the Council on 27 September directed the officers to prepare draft conditions which the Council could impose, if minded to approve the application. On 18 October 2011, the Council resolved 5 votes to 4 to grant the development consent ('DC'), which the Pittys challenge in these proceedings. 11The applicants press two grounds of challenge from their Points of Claim ('POC'). In summary, they firstly allege that the Council failed to consider some mandatory relevant matters, and their second ground of challenge is jurisdictional error concerning consideration of certain zone objectives. Two other grounds of challenge, one based on consideration of "cumulative impact", and the other on "manifest unreasonableness" (POC 30 - 32, and 39 - 40), were abandoned at the hearing.

The LEP 12The aims of the LEP are set out in cl 2, as follows: This plan aims to establish the framework for future development within the local government area of Bega Valley and to achieve the following objectives: (a) to ensure a balanced approach to development which is sensitive to both the economic and social needs of the community, (b) to protect and improve the economic, natural, social and cultural resources within the Council's area, (c) to encourage the efficient and effective delivery of services, and (d) to recognise, protect and improve the inherent natural and built character of the Council's area, (e) to ensure that development has regard to the principles of ecologically sustainable development. 13The general controls for development in the Residential Low Density Zone 2(a) are set out in cl 20, which sets the following objectives for the zone: (a) to allow residential development, including dwelling houses and attached dual occupancies, (b) to maintain and enhance the character of residential areas, to promote good design, (c) to enable development which serves the needs of people in the residential areas, (d) to ensure that development does not have an unacceptable impact on adjoining land, by way of shadowing, invasion of privacy, noise and the like. 14The only development allowed in the 2(a) zone without development consent is "environmental facilities", but the list of developments that are allowed "only with development consent" relevantly includes some which are not truly "residential" in character, such as child care centres, clearing of land, community centres, convenience stores, educational establishments, hospitals, places of public worship, professional consulting rooms, recreation areas, and utility installations. "Refreshment rooms" are not listed at all. All non-listed development is prohibited. 15Clause 30 deals with the General Business Zone 3(a), the zone objectives for which are: (a) to encourage a high standard of commercial development, create compact business centres which service the population and visitors and facilitate the expansion of business activities in appropriate locations, (b) to set aside certain land for the provision of services required by the travelling public for the development of facilities for refreshment, accommodation, recreation and amusement, (c) to permit non-commercial development where such development complements the intended commercial character of the locality, including dwellings attached to commercial development. 16Again in the 3(a) zone, "environmental facilities" is the only development allowed without development consent. Developments allowed only with consent relevantly include business premises, dwelling houses attached to commercial premises and/or shops, multi-unit housing not at street level, professional consulting rooms, refreshment rooms, shops, and a few of the non-residential uses noted above for the 2(a) zone. Again, all non-listed development is prohibited. 17Clause 65 of the LEP lays down some general principles for the development and use of land and buildings, and it sets out a list of impact considerations which must precede the grant of consent within any zone. Clause 65(1)(b) provides that one such consideration is: the cumulative impact on the environment of: (i) the development, and (ii) other development in the vicinity of the proposed development. 18Clause 8(3) relevantly provides as follows (emphasis added): Consent must not be granted to development proposed within a zone unless the consent authority has taken into consideration such of the objectives of the zone as are relevant to the proposal and is satisfied that the development is consistent with those objectives. 19Of particular relevance to this case, however, are the terms of cl 66, which provides as follows (emphasis added): Development near zone boundaries (1) Development that (in the absence of this clause) would be prohibited in a zone may be carried out with development consent within 50 metres of the boundary between that zone and another zone if it is permitted in the other zone either with or without consent. ... (3) Consent must not be granted pursuant to this clause unless the consent authority is satisfied the proposed development satisfies the objectives of the zone in which it will be carried out. ... (5) For the purposes of this clause, the zone boundary is the boundary between adjoining zones as shown on the zoning map and is not affected by the application of subclause (1). 20The McDonald's proposal is, therefore, permissible with consent in the 3(a) zone, subject to compliance with cl 8(3), and, in the 2(a) zone, only if it gets the benefit of cl 66(3). 21Essentially the applicants argue that the Council had to be satisfied that the development satisfied all the objectives of the 2(a) zone, and the second respondent contends that the Council had to be satisfied only that the development satisfied the relevant objectives of the 2(a) zone.

The SEE in context 22The SEE (Exhibit A1, Vol A, commencing at fol 100) describes the proposal, its environs and impacts in great detail. It says that the surrounding area is characterised by a mix of commercial, retail, residential and recreational uses. On the opposite side of the highway to the north of the site is a large recreational area, sporting fields, and the Bega Primary School. On the eastern corner of Swan St, is a Caltex service station, and, south of that, an office building occupied by a construction company. South of the office building are single storey residences, more or less opposite the Pitty property. To the west of the subject site is a large open grassed area owned by the Council. Further to the east of the site, on Princes Highway/Carp St, are retail and commercial premises. 23The SEE proceeded (from fol 123) to analyse the planning issues relevant under s 79C(1) of the Environmental Planning and Assessment Act 1979. Attention to the LEP included cls 20, 30, 65, and 66. Particular attention was given to flooding issues. The subject site has been identified as "flood prone" under Bega Town Centre Development Control Plan No. 41. Indeed, flood constraints render the subject site totally inappropriate for residential development. Of a flood in March 2011 (photos of which appear in Exhibit A1, at fols 581 - 598), Dr Pitty said (in Annexure 'B' to his affidavit): The proposed site was comprehensively flooded to a depth that would have submerged electrical and other essential services. The northern side of our garden (on number 9) was submerged to a depth of five feet at our northern boundary fence. 24Flooding and stormwater were dealt with in s 4.7 of the SEE (fol 130). It was agreed, prior to lodgement of the DA, that the finished floor level of the development should equate to RL 14.2 AHD (the 1:20 year event). It was considered that to raise the site levels above the 1:100 year flood event level would considerably detract from visual amenity of the streetscape of the highway boundary. 25The Pitty house itself is located approximately 10m from the northern boundary of its block, and is separated from the subject site by a driveway and landscaped area. The proponent's traffic experts recommended in the SEE the construction of an acoustic wall along the southern boundary of the site to mitigate the potential impact of noise from the "drive through" on the Pitty dwelling. The acoustic wall will include a cantilevered awning (fol 122), and will be set back approximately 2m from the site's southern boundary. The area between the acoustic wall and the southern boundary is also to be landscaped. 26In the section of the SEE dealing with zoning and permissibility (fol 126), cl 66(3) is accurately noted as requiring the consent authority to be satisfied that the proposed development satisfies the objectives of the zone in which it will be carried out. It goes on then to assert that the development is "not in-consistent (sic)" with the objectives of the 2(a) zone, as it will serve the needs of the people in the residential areas, and will not have a unacceptable impact on adjoining land in terms of overshadowing, privacy, noise and the like. It then asserts that the development "is also consistent with" the objectives of the 3(a) zone, as it will achieve a high standard of commercial development near the business centre, service the population and visitors in an appropriate location, and provide a key service to the travelling public. 27It is the tension between concepts of "consistency" and "satisfaction" which lies at the heart of the dispute before the Court in these proceedings. Use of other terms, such as "compliance", "in keeping with", "achieves", "compatible" etc, adds some complexity, and, possibly, confusion, to the consideration of that key question. 28In terms of social and economic impact (fol 131), the SEE notes that a large proportion of trade will come from local residents and workers in the surrounding area, as well as visitors and non-residents passing through the town. At the time of the DA and SEE the proposal was for 24 hours per day operation, seven days a week ('24/7'), but it was not expected to draw significant patronage away from existing restaurants or cafés. The economic impact was expected to be positive for Bega. 29Traffic issues were examined in an expert report attached to the SEE (fols 358 ff). Existing flows and expected increases were tabulated (fol 369), and it was expected that, at peak times (Friday PM and Saturday lunchtime), traffic movements in the short section of Swan St between the highway and the driveway access would increase by 140 vehicles per hour two-way. The report comments (fol 370): (1) "Increases on Swan Street, south of the restaurant, as well as on Carp Street and Hill Street, would be lower at some 20 to 50 vehicles per hour two-way"; (2) "the surrounding road network will be able to cater for the traffic generated by the proposed restaurant", and (3) "access arrangements, parking layout and provision for service vehicles are appropriate". 30Before Council granted its approval, the proposed operating hours were reduced from "24/7" to 6am - 11pm seven days.

The Witnesses 31Apart from the Council documents (Exhibit A1), and the affidavit affirmed by Dr Pitty, consultant planner for McDonald's, Benjamin James Craig affirmed an affidavit, and Rebecca Amy Pleming, the solicitor having the conduct of the matter for McDonald's, swore two (dated 13 and 26 March 2012). None of the three deponents was required for cross-examination. Exhibit M1 includes some relevant documents exhibited to Pleming's 13 March affidavit, which were not included in Exhibit A1 (at least not in "final" form - see [70] below). 32Craig is principal planner at JBA Urban Planning Consultants Pty Ltd, with daily carriage of the subject DA on behalf of McDonald's. He attended, and made a presentation at, Council meetings on 26 July 2011 - both the ordinary meeting of the Council and a meeting of the Council's Planning and Environment Standing Committee were conducted jointly. All nine councillors were present, and the Pittys also addressed the joint meeting. A copy of Craig's PowerPoint presentation and his speaking notes are attached to his affidavit. 33He noted (in par 7) that his slides numbered 5.0 to 5.4 "address the question of consistency of the development proposed" with the objectives of the 2(a) zone. Other words such as "inconsistent", "compatible", "in keeping with" and "satisfy" appear throughout his materials, including slide 1.0 and his sworn version of his oral presentation (see pages 14 and 17), in which he offered to reduce hours of operation, and reconsider the location of the acoustic wall and the use of planting and other treatments to soften its appearance. Contrary to the views taken by the Pittys, he refuted (slide 5.3) any adverse overshadowing impact, and noted (slide 5.1) that the Council was satisfied with the acoustic elements of the project. He said (p. 16) that it was not correct to say that it is a "predominantly low density residential precinct". Slide 5.3 suggested that "compliant residential development would have a greater impact on Swan St". Residences located on Swan St are "somewhat divorced from the site", and the proposed active frontage to Swan St is entirely compatible with the service station site located directly opposite. 34Pleming exhibited to her affidavits the Council file (Exhibit A1), and various minutes of meetings of Council and its Planning and Environment Standing Committee (held on 26 July, 27 September, and 18 October - Exhibit M1). Following the meeting of 18 October, the Pittys wrote to the Council requesting voice records and written transcripts of those meetings. The Council provided DVD evidence upon which McDonald's indicated it intended to rely, and a transcription was made of the whole of the Council's discussion and determination on 18 October 2011. That transcript is annexed to Pleming's later affidavit, and played a significant part in these proceedings. While it is not entirely clear which councillor is speaking at various times in the transcript, counsel for the Pittys took no objection to the accuracy of the commentary as presented.

Council's Consideration of the DA 35It is clear from the amount of material provided by the Council in Exhibit A1 that a lot of work and widespread consultation took place during the Council's assessment of this project. 36On 1 March 2011, the RTA advised (Exhibit A1, Vol B, fol 526) that it proposed to have the Bega bypass, southwest of the subject property, but that, in any event, it did not support the application in its current form, mainly because of right turn arrangements at the corner of Carp and Swan Streets. On 27 May, the RTA withdrew its objection, subject to agreement on conditions. 37Amended plans were submitted by JBA (see fol 552) on 18 March 2011, and JBA made an additional submission on 30 March 2011 (fols 614 - 630). It included (at fol 619) amended proposals in respect of the acoustic wall, regarded as "a necessary measure to enable the proposed development to comply with the recommended noise criteria". Some planting on the southern side of the wall, to soften the interface with number 11, was proposed, and, if the owners of number 11 desired, trellises, to facilitate the creation of a "green wall", would also be provided. 38On 31 March 2011, JBA responded, in detail, to the various submissions that Council had received during the exhibition of the DA (fols 634 - 644), and the Council was asked to consider that response in conjunction with the SEE. 39Dialogue between Council officers and JBA personnel (especially Claire Wright) continued throughout April, May and June. On the Council side of that dialogue, there was substantial concern among officers. For example, the senior environmental health and building surveyor noted on 9 June (fol 690) "in general and at the risk of repeating myself this is the wrong site for this development". He said that the proposed 4.5m acoustic wall on the boundary was "totally out of context" for the location, and not justified by the noise predictions. However, some sources of noise had not been examined. 40The Council file indicates that Council became aware, during this dialogue, of the reasoning of Acting Senior Commissioner Brown in the case of another McDonald's project proposed for a residential setting, at Haberfield - his judgment of 20 May 2011 (McDonald's Australia Limited v Ashfield Council [2011] NSWLEC 1140), appears in the Council file (fols 734 - 754). The file also contains copies of judgments from other cases before this Court. 41By the end of June 2011, Council officers had decided to report the McDonald's application to the Council meeting scheduled for 26 July 2011. The Council did not require any further information from the proponent at that time (fol 778). 42On 8 July 2011 (fol 780), the Council officers alerted Craig that the key issues to be raised in the officers' report to Council were the use of cl 66 where the development did not meet the objectives of the 2(a) zone, the adverse impact of 24/7 operation, the adverse impact of the proposed acoustic treatment, and the lack of a suitable buffer to residential properties surrounding the subject site. 43The agenda paper for the Council meeting on 26 July was duly made public, and several people sought the opportunity to address the Council. Dr and Mrs Pitty were prominent among that list (fol 790 - 791), and councillors were notified of planned addresses. 44The s 79C report to the 26 July meeting commences at fol 792. In terms of a summary of considerations mandated by the LEP, it notes (at 794): Clause 8 "The proposed development is not in keeping with the 2(a) zone objectives ..." ... Clause 20 "The proposal is inconsistent with the objectives of the zone" ... Clause 30 "The proposal would meet the objectives of the 3(a) zone" 45The report noted (at fol 796) some inconsistencies between the proposal and the provisions of cl 65, and, in respect of cl 66: The use of the 50m rule is not supported in this case as the development would not satisfy the objectives of the 2(a) zone ... 46The report went on to consider a 2010 draft of a proposed new LEP, and then various DCPs. The summary relevant to DCP 41 concluded with a notation of the agreement reached regarding the Flood Protection decision (fol 799): Strict compliance with the 1:100 level "is not considered to be in the interest of streetscape character and amenity", and it was noted that that variation in the development standard was "suitable in the circumstances of this case". 47The s 79C assessment report concluded (at fol 805) that the proposal was "unsatisfactory", and the report was endorsed, in handwriting", application recommended for refusal". 48In advance of the July 2011 meeting, the local ABC reported on the reservations of the Council planning staff (fol 808), and that Hugh Pitty was "leading the fight against the franchise". He was reported as noting that some of the planning policies adopted by the Shire Council back in 2006 anticipated the Bega bypass, and had identified "suitable sites" for a 24/7 fast food drive-in facility. 49The officers' narrative report to Council appears at fols 810 - 841 of volume B of Exhibit A1. 50Among many critical comments, that report noted (at fol 813) the objectives of the 2(a) zone, and the officers' conclusion that the development, "with its operational impacts and design", would be contrary to those objectives. Specifically it commented: Swan Street and Hill Street are predominately characterised as a low density residential area, with the majority of allotments being occupied by single storey dwelling houses. It is considered that the encroachment of the proposed commercial use into this residential area would have a significant impact on the character of the streetscape. In particular the McDonalds Restaurant, with its proposed 24/7 trading hours, drive-through facility, entrance/exit off Swan Street and resulting extensive acoustic mitigation treatments would result in a development that would adversely alter the low density residential character of the immediate locality. 51In terms of noise impacts, the report said (at fol 815): The proposal would also generate unacceptable noise impacts from patrons through the extended (night time) hours of operation, which would be incompatible with the existing residential amenity and character. It is also noted that the current background levels are influenced by highway noise. It is likely that once the Bega bypass is competed and traffic levels change accordingly, the background noise levels used in the report may be lower than reported and therefore there is potential for additional intrusive noise impact on the residential amenity of the area as a result of the proposed development. 52The report noted (at fol 816) that, if the application were to be approved, Council would ensure that delivery times would be specified to ensure onsite truck manoeuvring occurred outside peak operating times. 53In the Council officers' conclusion (at fols 823 - 824), the following appeared: It has been concluded that the development would not be consistent with the objectives of the residential zone in which part of the development would to (sic) be located. (The provisions of Clause 66 of LEP 2010 (sic) enable a consent authority to permit development that would otherwise be prohibited in a zone, provided the objectives of the zone are satisfied). It is considered that the proposed development would not meet the objectives of the 2(a) Low Density Residential zone as the development would not maintain or enhance the character of the residential area, would not result in good design, and would have an unacceptable impact on adjoining lands by way of visual impact, noise, hours of operation and traffic. The proposed development is considered to be an overdevelopment of the site as inadequate opportunity exists to mitigate the development impacts and it is on these grounds that the application is recommended for refusal. 54A detailed recommendation of refusal followed, which included, among the reasons, the following, in respect of cl 66 (emphasis added): c. The development fails to satisfy the requirements of Clause 66 in relation to development adjoining zone boundaries as the proposal does not satisfy the objectives of the 2(a) Low Density Residential Zone. 55The minutes of the Planning and Environment Standing Committee meeting and of the Ordinary Council meeting, held jointly on 26 July (tabs 1 and 2 of Exhibit M1), record that the two applicants and their son Hugh all addressed the meeting, along with Craig and others, and that the matter was deferred to enable an onsite meeting to take place. 56On 27 July 2011, Council's Cecily Hancock sought from the proponent more information, so that she could prepare a report for the Council meeting on 16 August (Exhibit A1, Vol C, fol 1252). Acoustic aspects continued to be examined by the parties during July/August. Craig supplied some further information on 28 July (fols 1254 - 1257), and on or about the 12 August 2011 (Exhibit A1, Vol D, fols 1270 - 1347). As Craig says in the letter (at fol 1277), McDonald's had "gone to significant lengths to respond and address the concerns of Council and local residents ...", including "a substantial reduction in the proposed trading hours", and changes to the buffer along the southern boundary. An updated acoustic report was enclosed. All that material was forwarded by Hancock to Dr & Mrs Pitty on 16 August 2011, at which time she excepted to report to Council on 6 September. 57Trevor Forster, Development Manager of McDonald's, wrote to Hancock on 24 August 2011 (fol 1350), expressing disappointment that the Council officers were "still unable to support the application". He sought a better indication of what was unacceptable to the Council in respect of amenity impact, and a "definitive direction" in that regard. He raised the question of the acoustic wall that became an issue in the Haberfield case, and he provided a depiction of the outcome that was achieved in that appeal. 58Hancock responded (fol 1352) that she was undertaking "a thorough review of the additional information provided", and that she would "ensure that a balanced report" went back to Council. She indicated that the report would likely go to Council on 27 September. 59On 16 September 2011, Hancock advised Craig (fol 1386) that the Council staff would recommend refusal prior to the meeting of 27 September, and that officers would prepare a set of conditions for Council's consideration if the councillors resolved to approve the application. "At this point in time no such draft consent exists". 60Forster wrote a lengthy letter to the Mayor, Councillor Allen, on 20 September 2011 (fols 1392 - 1398), describing all the changes that had been made to the proposal since 26 July. Again he relied on the Haberfield decision. Acoustic walls adjacent to residential dwellings had been tested at the highest level, and deemed an acceptable outcome (fol 1397). 61The Council report for the meeting of 27 September 2011 (Exhibit A1, Vol D, at fols 1406 - 1449) noted (at fol 1407) that the issues raised in the addresses made to Council on 26 July had all been considered by Council staff, but the DA was still recommended for refusal. The report detailed the additional information provided by McDonald's, and attached a copy of the officers' responses. 62The draft 2010 LEP was also addressed (fols 1409 - 1410). It included (as cl 5.3) a "20m rule", instead of the "50m rule" (cl 66). The whole of Lot 2 is located within 20m of the inter-zone boundary, so the new cl 5.3 would apply. Again, however, the officers opined that the proposal, as amended, would not satisfy the objectives of the new Low Density Residential Land Zone (to be styled "R2"). 63Officers remained concerned (fol 1410) about any operation outside the hours 7am - 10pm. The cumulative impact of the noise predicted to be generated from the site "may be unacceptable and not in keeping in the residential amenity of the locality" (fol 1410). There was a difference among the acoustic experts, and, if the Council decided to approve the application, ongoing verification of actual noise levels would be required (fol 1411). The revised acoustic wall arrangements were "a marked architectural improvement", as was the additional landscape buffer. 64There remained some issue about the filling of the land in order to achieve the 1:20 flood clearance (fol 1411), but the report went on (at fols 1412 - 1415) to deal with the issues raised at the 26 July meeting, but not covered in the previous report - headlight glare, the effectiveness of the acoustic barrier, noise impacts from delivery trucks, large vehicle parking, impact of redirected traffic during flood events, proposed traffic treatments at the Carp Swan intersection, constraints of on-street parking in Hill St, and on-site traffic congestion. 65The report's overall conclusion (at fol 1416) says: As outlined in the report to Council on 26 July 2011 staff are of the opinion that the proposed McDonald Restaurant would not be consistent with the objectives of the residential zone in which part of the development would be located. It is considered that the proposed development would not meet the objectives of the 2(a) Residential Low Density zone as the development would not maintain or enhance the character of the residential area, would not result in good design, and would have an unacceptable impact on adjoining lands by way of visual impact, noise, hours of operation and traffic. Staff maintain that the use of the '50 metre rule' specified by Clause 66 of the Bega Valley Local Environmental Plan 2002 is not appropriate in this instance and the proposed development is considered to be an overdevelopment of the site. On these grounds the application is recommended for refusal. 66The recommendation again included (see [54] above), as a reason for such refusal: c. The development fails to satisfy the requirements of Clause 66 in relation to development adjoining zone boundaries as the proposal does not satisfy the objectives of the 2(a) Low Density Residential Zone. 67JBA's letter of the 12 August, but not Forster's letter to the Mayor, was attached, as were various acoustic reports. 68At fols1450 - 1488, there is a copy of material carrying Craig's name, apparently designed to inform an address to Council at the September meeting. The summary (at fol 1450) deals with each element of the July refusal decision in turn. In response to reason 'c', quoted above, the notes say: "The proposed development is considered to deliver a better design outcome for the site. Residential not possible on the site". The estimated annual investment for the region would be up to $1.18M. Approximately 100 people would be engaged in work of various classifications. 69It would appear that this McDonald's material was provided to those present at the Council meeting (see entry 271 at p13 of the index to the four Council bundles). Some detailed presentations were made on behalf of objectors (e.g. Hugh Pitty at fols 1493 - 1497 of Vol D). 70Draft minutes of the standing committee meeting appear at fols 1498 - 1501, and the minutes appear at tab 3 of Exhibit M1. As both sides relied on Exhibit M1, and did not draw attention to the version in Exhibit A1, I take it that the committee (in the absence of Councillor Wykes) considered a motion (moved Fitzpatrick/Hede) that the general manager report to the next meeting on matters under s 79C that would enable consideration to be given to the granting of consent, and that such report should include suitable draft conditions. Councillor Hughes foreshadowed that he would move the recommendation for refusal, as contained in the report. The Fitzpatrick/Hede motion was carried 5 votes to 3. (An undated draft list of appropriate template consent conditions appears in Vol D of Exhibit A1, at fol 1502) The objector presentations were given in the open meeting (Exhibit M1, tab 4), and the committee's report was adopted by the full Council, again 5 votes to 3 (pp 4-5). 71On 11 October 2011, Hancock advised Craig and Forster that the application would come back to the Council on 18 October. On 17 October Forster wrote again to the Mayor, Councillor Allen, detailing an objection to specific draft conditions formulated for consideration by Council at that meeting. (A copy of that letter, at fols 1527 - 1532 of Vol D, carries some hand written notes regarding the company's contentions, and a clean copy appears at fols 1533 - 1539). 72The officers' report to Council for the meeting on 18 October (at fols 1540 - 1563) attached draft conditions, including special conditions, to address key issues identified in the s 79C assessment. 73At page 34 of the Planning and Environment Committee papers (fol 1542), one of the key issues raised in the assessment was noted (with my emphasis) as "compliance with the objectives of the zone and the appropriate use of cl 66 of the Bega Valley Local Environmental Plan 2002 (in relation to the '50 metre rule')". On the next page, the report noted "that the concerns raised by staff in relation to satisfying the objectives of the zone and the use of Clause 66 of the Bega Valley Local Environmental Plan 2002 cannot be address (sic) by specific conditions of consent". 74The draft conditions appear at folios 1544 - 1561. The RTA letter of 27 May 2011 ([36] above) was another attachment to the report (fols 1562 - 1563). The officers recommended (at p35/ fol 1543) that Council agree to no more hours of operation than its preferred range, namely 7am to 10pm, seven days. Suitable conditions regarding ongoing compliance with Council's noise policy were also included, and the Council officers' covering report concluded as follows: Council has previously considered two reports from staff, being 26 July and 27 September 2011, which highlight the key matters for consideration in relation to the proposed development. In accordance with the Council resolution of 27 September 2011 a set of draft conditions of development consent are attached to this report that staff consider would be appropriate should Council resolve to approve the application. It is recommended that Council determine the application. 75The transcript of the Council and Committee debate(s) on 18 October is before the Court (as Attachment "D" to Pleming's later affidavit). 76Although not the chairman of the meeting of the committee, the Mayor, Councillor Allen, led the discussion (fol 10). He acknowledged that people thought the location "awful", but the "50 m rule" allowed the application to come to Council, to be passed if appropriate. He thought that the "bulk and scale ... on the revamped site" was "not dissimilar to what could be built there from a residential perspective" when the flood issue is taken into account. "That was a telling factor in my determining to support this motion". He sympathised with the objectors, but "the proposal does fit the bill ... it's just the location that is causing the dilemma ...". 77An unidentified councillor ("Speaker 5"), speaking soon after, commented (fol 11) that "what we're about to put there is a very high intensity commercial business and particularly on the weekends ...". He acknowledged that the Council had "as good a planning department you could possibly have and they strongly recommend the refusal of this development". 78The chairman of the committee (Councillor Campbell) then spoke at some length (fols 12 - 13). He expressed his support for the application. It was a "a local planning issue", and not a question of "anti-fat, anti-fast food and any big business objections". Nor was it a question of the likely cost of any legal proceedings that may flow from the Council's decision. He recognised that one of the planning questions was the inevitable conflict at the land use interface between commercial and residential development. He acknowledged that cl 66 was being relied upon by the proponent, and that the 26 July report saw "inconsistencies" across the zone boundary. 79He said: The objectives of both zones need to be considered and balanced. The commercial zone objectives are relevant and include ensuring a high standard of commercial development, the creation of compact business centre and the provision of land for services required by the travelling public including refreshment. An objective of the residential zone is to ensure development does not have an unacceptable impact on adjoining land by way of shadowing, invasion of privacy, noise and the like. 80He acknowledged "conflict caused by the zoning interface", and that the Pitty property will be "the most affected", and came to the view (as said) that "there is no determining inconsistency of the objectives that the zones created by this application. Also the amendments which were made to the application ... go a long way to satisfying the objectives of both..." He also acknowledged that Council staff still had concerns. 81He then (at fol 13) examined various impact issues in some detail, and concluded that, despite the flooding issue, a commercial use would be the highest and best use for the subject site, generating economic benefit, which would be in the public interest. 82The chairman was followed by a speaker against the project (wrongly identified as "Mr Campbell"), who said simply (fol 13) that "the location is not the right location, I don't have a problem with McDonalds coming to Bega at all, but I believe that is the wrong location. I support the reasons given by Council staff over two particularly in depth reports..." 83Councillor Seckold also spoke against (fol 14). No restaurant in Bega opens 17 hours a day, this is a quiet residential area, the canteens at the school and sporting complex (across the Highway) will be affected, and the McDonald's is an overdevelopment of the site. 84Councillor Wykes, also speaking against (fol 14), observed that Council had (as said) "zonings to provide for orderly development and this proposed development...[a] significant part of which is in area zone residential, effectively spoils the visual and amenity of the adjoining properties". He endorsed (fol 15) the comments in the original staff report. He was clear as to the requirements in cl 66, and used the word "satisfied" on several occasions. The only time he used the word "inconsistent" was not in respect of objectives, but in respect of scale and design, in comparison with the neighbouring low density residential development. 85Councillor Hede pointed out (fol 16) that, if Council no longer liked the "50 m rule", it should "get rid of it". Meanwhile it continued to apply, and had to be invoked in this matter. He was in favour of the development. 86The official minutes of the 18 October 2011 meetings (tabs 5 and 6 of Exhibit M1) record that a motion to suspend standing orders to allow addresses to be given to Council, including by the three Pittys and Mr Forster, was lost, 5 votes to 3. (Councillor Hughes is shown as absent.) The minutes of the Standing Committee (at tab 6) show Councillor Hughes as present. The meeting resolved, on the motion of Fitzpatrick/Hede, 5 votes to 4, that the Committee recommend to Council:

That Development Application 2011.0040 for demolition of a dwelling house and erection of a refreshment room and associated carparking, landscaping and advertising signage for use as a McDonalds Restaurant on Lots 1 and 2 DP 578015, 1-7 Swan Street Bega be approved with amendment to condition 20 opening hours to be 6am - 11pm and adjustment of conditions 48 & 49 to update section 64 charges to $ 127,560 for Water and $ 182,400 for Sewer supply respectively.
That those parties who made a submission be advised of Councils decision. 87When the Council meeting resumed, that recommendation of the Standing Committee was adopted with the same voting (tab 5, p6). The DC so granted was forwarded to Craig and to Forster on 20 October 2011 (Exhibit A1, Vol D, fols 1685 - 1686), and all objectors were notified (fols 1687 - 1688) on 24 October 2011.

Submissions 88As noted above (at [20]), the proposed McDonald's restaurant is permissible with consent on that part of the subject site which is in the 3(a) zone, provided that cl 8 is satisfied. That part of it which will be on the 2(a) land is permissible, with the benefit of the application of cl 66.

The Applicant's Submissions 89Mr Wilson submits (subs par 50), on the applicants' behalf, that a development which satisfies the Council in terms of cl 8 cannot, on the true construction of the LEP, satisfy the Council in terms of cl 66, and vice versa. He says that "the objectives of one zone are so inconsistent with the objectives of the other that the Council could not be satisfied in respect of both. Alternatively the Council failed to consider whether the objectives of each zone could be satisfied in terms of the" LEP. Further (par 51), clauses such as 8(3) and 66(3) have been construed in the authorities as conditions precedent to the grant of development consent. 90Mr Wilson relies (pars 52 - 54) on Clifford v Wyong Shire Council (1996) 89 LGERA 240 ('Clifford'), Hortis v Manly Council [1999] NSWLEC 151; (1999) 104 LGERA 43 (in which I followed Clifford, and also Franklins Ltd v Penrith City Council [1999] NSWCA 134 ('Franklins')), and on the Court of Appeal's decision in Manly Council v Hortis [2001] NSWCA 81; (2001) 113 LGERA 321 ("Hortis"). The Court of Appeal dismissed the appeal, and held that there was no evidence that the Council formed the requisite opinion as to satisfaction of the zone objectives, (which was identified as a precondition to the grant of DC). The Court of Appeal said (at [54]): ...an inference that a consent authority considered a specific precondition to its power to grant a development consent will not normally be derived from material which demonstrates no more than that the consent authority was aware of the issues which were relevant to its decision whether or not to grant consent if it had power to do so. 91Mr Wilson also relied (par 55) on Coffs Harbour City Council v Arrawarra Beach Pty Ltd [2006] NSWLEC 365; (2006) 148 LGERA 11 ('Arrawarra'), in which the LEP mandated that Council not grant DC, unless it had taken into account certain objectives specified in other legislation. Talbot J ([42]) relied upon Franklins, and said that "the existence of the mental state of satisfaction is an 'essential condition' or preliminary to the exercise of power". 92Mr Wilson submits (pars 56 - 57) that, in the present case, Council failed to identify and deal with each of the objectives in a way that satisfied the principles in those cases. He further submits that the Council did not apply cl 66 in accordance with its terms, and that the Council failed to consider whether the development satisfied the objectives of the 2(a) zone. 93In Mr Wilson's submission on cl 8 of the LEP (subs 58 - 59), he urged the Court to have regard to the following observations of Biscoe J in Capital Airport Group Pty Ltd v Director-General of the NSW Department of Planning (No 2) [2011] NSWLEC 83 ('Capital Airport Group') (at pars [98] - [100]): 98 The content of a statutory duty to "have regard to" or "to consider" something has been expressed in various ways. In Tickner v Chapman (1995) 57 FCR 451 at 462 Black CJ said that a duty to "consider" required an "active intellectual process" directed at the matter required to be considered. In Tobacco Institute of Australia Ltd v National Health and Medical Research Council (1996) 71 FCR 265 at 277 Finn J said: ...the "have regard to" formula has been interpreted consistently as requiring that the decision-maker subject to the formula must "take into account" the matter or consideration to which regard is to be had, and must "give weight to" that matter or consideration "as a fundamental element in making his determination": R v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 328-330 per Mason J; see also R v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327 at 333, 338; Queensland Medical Laboratory v Blewett (1988) 84 ALR 615 at 623. 99 In Zhang v Canterbury City Council [2001] NSWCA 167, 51 NSWLR 589 Spigelman CJ, who delivered the leading judgment, held that a matter which a statute required the decision-maker "to take into consideration" must be considered as a fundamental element in, or focal point of his deliberatons. A "mere formalistic reference" does not satisfy a statutory requirement to have regard to a matter: Telstra Corporation Ltd v Australian Competition and Consumer Commission (No 2) [2007] FCA 493, 240 ALR 135 per Lindgren J at [29]. 100 The High Court in Minister for Immigration and Citizenship v SZJSS [2010] HCA 48, 85 ALJR 306 at [26] approved the formula of Gummow J in Khan v Minister for Immigration and Ethnic Affairs [1987] FCA 457, 14 ALD 291 that the statutory duty to "consider" means to "give proper, genuine and realistic consideration to the merits of the case", whilst noting the caution in Swift v SAS Trustee Corporation [2010] NSWCA 182 at [45] that those words should not be permitted to encourage a slide into impermissible merits review. No reference was made to a view earlier expressed by the Court of Appeal that it is preferable to avoid using that formula or similar descriptive formulae, but that the relevant matter must be more than merely adverted to or given mere lip-service: Anderson v Director-General Department of Environment and Climate Change [2008] NSWCA 337, 163 LGERA 400 at [51] - [58]. For an earlier review of the authorities relating to the use of this formula see my judgment in Anderson v Minister for Infrastructure Planning and Natural Resources [2006] NSWLEC 725, 151 LGERA 229 at [52]. 94Mere advertence to the LEP's requirements is inadequate consideration (par 60): See Weal v Bathurst City Council [2000] NSWCA 88; (2000) 111 LGERA 181. The following paragraph on the concept of "proper, genuine and realistic consideration" appears in Pepper J's recent judgment in Oshlack v Rouse Water (No 2) [2012] NSWLEC 111, delivered soon after my judgment in this matter was reserved: 83. The genesis of the phrase "proper, genuine and realistic consideration" is attributed to Gummow J in Khan v Minister for Immigration and Ethnic Affairs (1987) 14 ALD 291 (at 292). Although it was criticised by Basten JA in Kindimindi Investments Pty Ltd v Lane Cove Council [2006] NSWCA 23; (2006) 143 LGERA 277 (at [79]) lest it "encourage a slide into impermissible merits review", and caution was urged in its use in Anderson v Director General, Department of Environment and Climate Change [2008] NSWCA 337; (2008) 163 LGERA 400 (at [57] per Tobias JA), the High Court has nevertheless continued to employ this formulation (Minister for Immigration and Citizenship v SZJSS [2010] HCA 48; (2010) 243 CLR 164 at [26], [32] and [34]). 95Mr Wilson also relied (par 61) upon Biscoe J's judgment in Addenbrooke Pty Ltd v Woollahra Municipal Council [2008] NSWLEC 190, where the relevant clause required the consent authority to be satisfied that the development was "consistent" with aims and with some "objectives". His Honour said (at [45]): Clause 17(2) of the Harbour REP prohibits the grant of development consent unless the consent authority is satisfied that the development is "consistent with the aims" of the Harbour REP and the "objectives of the zone" in which it is proposed to be carried out. The definition of "consistent" in the Macquarie Dictionary (third edition) is: "agreeing or accordant; compatible; not self-opposed or self-contradictory". In a similar context to the present it has been said that "consistent" means not antipathetic: Schaffer Corporation v Hawkesbury City Council (1992) 77 LGRA 21 at 27 and Hospital Action Group Association Inc v Hastings Municipal Council (1993) 80 LGERA 190 at 264, both decisions of Pearlman CJ. In Gillespies v Warringah Council (2002) 124 LGERA 147 at [70], [74] Bignold J considered that the word "consistent" is not confined to the notion of the proposed development not being antipathetic and is synonymous with compatible. I agree. 96In terms of cl 66 of the LEP, Mr Wilson relied heavily (pars 62 - 65) on Minister for Immigration and Multicultural Affairs v Eshetu [1999] HCA 21; (1999) 197 CLR 611('Eshetu'), which, in turn, relied on Buck v Bavone [1976] HCA 24; (1976) 135 CLR 110. 97In Buck v Bavone, Gibbs J said (at pp 118 - 119) when dealing with matters of which an authority was required to be satisfied: In all such cases the authority must act in good faith; it cannot act merely arbitrarily or capriciously. Moreover, a person affected will obtain relief from the courts if he can show that the authority has misdirected itself in law or that it has failed to consider matters that it was required to consider or has taken irrelevant matters into account. Even if none of these things can be established, the courts will interfere if the decision reached by the authority appears so unreasonable that no reasonable authority could properly have arrived at it. However, where the matter of which the authority is required to be satisfied is a matter of opinion or policy or taste it may be very difficult to show that it has erred in one of these ways, or that its decision could not reasonably have been reached. 98In Eshetu (at [136]), Gummow J cited that passage from Buck v Bavone, and said (in [137]) that it was: ... consistent with the proposition that, where the criterion of which the authority is required to be satisfied turns upon factual matters upon which reasonable minds could reasonably differ, it will be very difficult to show that no reasonable decision-maker could have arrived at the decision in question. It may be otherwise if the evidence which establishes or denies, or, with other matters, goes to establish or to deny, that the necessary criterion has been met was all one way. 99In Minister for Immigration and Multicultural Affairs v Jia Legeng [2001] HCA 17; (2001) 205 CLR 507, Callinan J said, in respect of the word "satisfied" (at [243]): The fact however, that the word "satisfied" as used in the sections is not expressly modified by the adverb "reasonably" would not relieve the Minister of the requirement of reaching a state of reasonable satisfaction[152]; that is to say, not one which no reasonable person could reach. This must be so because the legislature would hardly contemplate that a state of satisfaction of mind might be reached capriciously. 100Mr Wilson submits (par 67) that the Council was required to be "satisfied", in terms of cl 66, in respect of all the objectives of the 2(a) zone. Each of those objectives is relevant to the application, and the specific terms of cl 66 required the Council to be satisfied in respect of all of them. He developed this argument in the following way: a. for objectives (a) in the 2(a) zone, residential development is permitted in the 3(a) zone provided it is attached to commercial premises and/or shops; b. objective (b) is obvious; c. objective (c) has to be read in context of the other objectives of the zone and even though in one sense the development may meet the needs of people in the residential areas, the McDonalds has a far wider catchment. It is submitted that in the context of the BLEP and in particular, the objectives of the 2(a) zone the McDonalds does not meet those needs but, the restaurant may include meeting the needs of those people: see, for example Warriewood Properties Pty Ltd v Pittwater Council [2010] NSWLEC 215 [83] - [90] and in particular [89] (a class 1 application where the characterization of the development as a 'neighbourhood shop' requiring provision 'for the day-to-day needs of people who live or work in the local area" [19]. d. It is submitted that the Council failed to discharge its functions in accordance with the Act and the provisions of the BLEP. The appeal should be allowed. but the Court notes that his written submissions come to an abrupt end at that point, and it would appear from the oral argument that some part of the document has been lost. 101In his oral argument, however, Mr Wilson submitted that to find that it was not necessary for Council to have regard to all of the 2(a) zone objectives would be to adopt a construction of the clause which, having regard to the provisions of cl 8(3), is not consistent with the construction of the LEP. He also submitted that, in order to determine which of those objectives were in fact relevant, Council was required to actually turn its mind to each of them (T p17 LL31-37). He submits that objective (a) in cl 20 ([13] above) was "simply cast aside" (T p 33 L 44). 102Mr Wilson also argues that the theme in the SEE, Craig's presentations, and the Council meetings, involved a process of finding consistency with the 2(a) zone objectives, rather than a state of satisfaction (T p 37 L7 ff). 103Mr Wilson said in his written submissions (par 66, and see T p 33 LL 11-16) that the Oxford Dictionary defines "satisfy" as: "Meet the expectations, needs or desires..."; and "adequately meet or comply with (a condition, obligation or demand)"; and "provide adequate or convincing information or proof about something". 104Although there "was pretty extensive evidence in relation to qualitative issues of privacy and quantitative issues of shadowing, noise and the like", each of the objectives must be "read individually and together" (T p8 LL21-24). Satisfaction of the needs of people does not make the development per se permissible; the Council must balance that objective against the others found in cl 20 (T p 8 LL24-29). Accordingly, even if it is found that there was evidence available to support a finding that the 2(a) zone objectives are satisfied, the Council did not engage with that evidence, as is clear from the October debate (T p 39 LL4-6). 105Mr Wilson also claims that the SEE and Craig's presentation had the test wrong (T pp38-9).

The McDonald's Submissions 106Mr Galasso SC, on behalf of McDonald's, summarised the applicants' case (POCs 26 - 40, so far as they were pursued), as follows (in his subs par 1.8): Council failed to consider relevant matters, namely the consistency of the proposed development with the objectives of the 2(a) zone, and, as a consequence, did not have jurisdiction to determine the DA by the grant of consent. 107He submits that perusal of the documentary material makes it clear that the Council paid positive attention to the question of the development's consistency with the objectives of the 2(a) zone, and to its cumulative impact, and that there was ample evidence before the Council upon which Council could base its positive finding of consistency. Consistency with the 2(a) objectives was addressed in the SEE (at paragraph 4.2), in Council's July report recommending lack of it as a reason for refusal, in Craig's presentation to the Council, in Mrs Pitty's submission (at Exhibit A1 Vol D, fols 1361 -1371), in Council's September report again relying upon lack of it as a reason for refusal, in the October report, and in the October discussion by councillors. 108Mr Galasso noted the different tests stated in cls 8(3) and 66(3) - satisfied of consistency, in 8(3), but satisfied that the objectives are satisfied, in 66(3). 109McDonald's submits (subs par 4.1) that the claims made by the applicants regarding this issue are "not open as a matter of the proper construction of the LEP, or alternatively are not established on the evidence that was before the Council at the time it made its determination to grant development consent..." . 110Clause 8(3) is a "conventional type of clause" (par 4.4), which is, frequently, both applied by councils, and litigated in this Court. See Schroders Australia Property Management Ltd v Shoalhaven City Council [2001] NSWCA 74 ('Schroders'), and Boral Resources (Country) Pty Ltd v Clarence Valley Council [2009] NSWLEC 81; (2009) 167 LGERA 134 ('Boral'). 111Preston ChJ, when considering a clause similar to 8(3), in Conservation of North Ocean Shores Inc v Byron Shire Council [2009] NSWLEC 69; (2009) 167 LGERA 52 ('North Ocean Shores') (at [83]), noted that the forming of a positive opinion of such consistency was "necessary to enliven the power to grant consent to the development". There being ample evidence in the present case that Council paid positive attention to the consistency issue, and proceeded to form a positive opinion to enliven its power, Mr Galasso asks the Court to find that the consistency issue and its importance were very much in the minds of the councillors prior to the grant of consent. 112The same councillors are recorded as present at all relevant discussions, and, so, had heard Mr Craig's July presentation regarding satisfaction of the zone 2(a) objectives. They undertook (par 4.8) a "detailed analysis of the consistency issue from both perspectives, leading to a reasoned and informed debate on the consistency issue, from which particular findings were made". Once McDonald's had addressed many of the merit concerns during its negotiations with the Council, "the consistency issue remained as one of the few reasons relied upon by the Council officers for the recommendation for refusal" (par 4.11). 113In terms of actual consistency with the objectives, Mr Galasso submits (pars 4.14 - 4.15) that there was ample evidence before the Council to support its determination of consistency - in the SEE, in the JBA submission of 31 March, in the Craig presentation and the materials it relied upon, in the acoustic information, in the amended application, and in the McDonald's letter to the Mayor, dated 20 September. 114Schroders decided that the contents of the Council file may be presumed to be within the knowledge of councillors, and the Craig presentation on 26 July was also relevant on this question. Craig analysed each objective in turn (par 4.17): a. The site because of its flood constraints is inappropriate and unsafe for residential development. b. The development would result in a good design outcome which will enhance the character of the immediate area, which is not limited purely to residential. c. The development will serve the needs of people in the residential areas (not just the travelling public) d. Reservations about merits issues were adequately addressed, by October, and any compliant residential development would have a greater impact on the adjoining property (see also slide 5.4). 115The transcript of the Council discussion also indicates councillors' specific engagement with all these objectives during the debate. 116Mr Galasso points out that zone objective (a) requires only residential development be "allowed" - it is not "required". The other objectives are clearly addressed in detail in the assessment reports, with the result that few merit objections remained by October, and the material that was relevant to the consistency issue included a significant degree of analysis for the purposes of satisfying the requirements of cl 8(3) and cl 66(3). 117This situation is in stark contrast to the situation in North Ocean Shores, and significantly more comprehensive than what was before the Council in Boral. In North Ocean Shores, Preston ChJ noted that there was "very little to demonstrate" consistency with objectives, and, in Boral, Pain J held that a challenge on a similar consistency issue should not succeed. 118McDonald's submits (par 4.23) that, on the basis of all the material, it was clearly open to the Council to conclude that the proposed development was consistent with the objectives of the 2(a) zone, and that there was no failure to comply with a condition precedent to the grant of consent - see Currey v Sutherland Shire Council (1998) 100 LGERA 365, Hortis, and Franklins. Accordingly, there was no error of law in the granting of the consent. 119The applicants maintained their submission that all the zone objectives had to be satisfied, and McDonald's contends that it can establish that all were, indeed, satisfied. However, McDonald's argues that, when properly construed, cl 66(3) requires satisfaction of only relevant objectives, just like cl 8. Mr Galasso recognises that cl 66(3) does not expressly employ the word "relevant", but he contends that, properly interpreted, that word should be inferred. To adopt the applicants' preferred construction would result in irrationality and injustice in the construction of the instrument, and, Mr Galasso submits, can not have been the intention of the draftsperson. 120In Mr Galasso's submission, the clause is intended to add into the instrument a degree of flexibility, in order to facilitate development that would achieve appropriate planning outcomes. It would not seek to impose a higher standard or threshold than cl 8. He asks (at par 4.33): How can it be that development proposed in the centre of a particular zone (presenting more of a reason for consistency with zone objectives) can be held to a lesser standard than development on the fringe of a zone where the LEP contemplates that development that is otherwise prohibited may occur? 121Not all of the uses shown as permissible within the 2(a) zone can satisfy all of the objectives of that zone. For example, convenience stores are clearly unable to satisfy objective (a); utility installations and hospitals would be highly unlikely to satisfy objective (b); and a dwelling house would be unable to satisfy objective (c). Beazley JA observed in Abret Pty Ltd v Wingecarribee Shire Council [2011] NSWCA 107; (2011) 180 LGERA 343 (at [42] - emphasis mine): I do not agree with the Council's submissions on this point. In my opinion, the trial judge erred in his approach and conclusions at [35] and [36]. Dealing first with [35], it is apparent that his Honour's reasoning is directed to the objectives of the zoning table. They are not provisions of the LEP that control development. Rather, they set the framework in which the LEP operates. The objectives themselves are not necessarily consistent, but reflect the conflicting demands upon development within the particular Local Government Area. For example, there is an apparent conflict between paras (d) and (i) of the objectives. One aims for the protection of the agricultural production of prime crop and pastoral land: para (d). The other aims to provide a variety of residential environments: para (i). There is no provision in para (i), as there is in para (n), which promotes multiple occupancy, but not on prime and crop and pasture land. It was not suggested by Council that there is a priority of objectives in the clause. Accordingly, there was no basis for the trial judge to rely upon the objective in para (d) rather than the objective in para (i). 122Mr Galasso's submissions continued: 4.36 The Interpretation Act 1987, section 33 provides: "In the interpretation of a provision of an Act or statutory rule, a construction that would promote the purpose or object underlying the Act or statutory rule (whether or not that purpose or object is expressly stated in the Act or statutory rule or, in the case of a statutory rule, in the Act under which the rule was made) shall be preferred to a construction that would not promote that purpose of object." 4.37 As a species of delegated legislation, statutory instruments such as LEPs fall for interpretation in accordance with the general principles of statutory interpretation, looking at the language, policy, intention and purpose of all the instrument's provisions. 4.38 In Public Transport Commission of New South Wales v J Murray-More (NSW) Pty Ltd (1975) 132 CLR 336 at 350, Gibbs J said: "... where two meanings are open ...it is proper to adopt that meaning that will avoid consequences that appear irrational and unjust." 4.39 McDonald's submits that a construction of clause 66(3) that requires satisfaction only of those objectives relevant to the Proposed Development should be preferred. This is consistent with the decision of Conservation of North Ocean Shores Inc v Byron Shire Council (2009) 167 LGERA 52 at [19] and the decisions referred to therein. ... 6.1 Having demonstrated that the Council discharged its statutory obligation to consider, and consider adequately, relevant matters, as discussed in section 4 and 5 of these submissions, the Council had jurisdiction to consider and determine the Development Application. There was no jurisdictional error. 123Mr Galasso's submissions concluded (par 7.1) that the applicants' summons should be dismissed with costs. 124In his oral submissions, Mr Galasso submitted that although the Council report dealt specifically with objectives (b) and (d), the councillors "were actually more expansive in their consideration" (T p 49 L 43). In relation to evidence upon which Council could rely on for satisfaction of the 2(a) zone objectives, Mr Galasso referred the Court to Mr Craig's PowerPoint presentation, especially his summary slide numbered 5.0 (at folio 10 of his affidavit), which made "positive statements" about the zone objectives and submitted (T p52 LL 33-44): Firstly, "Flood constraints make the site inappropriate for residential development", that is, objective (a) allowing residential development. We will see ultimately what the council has thought about that point, namely, that the flood constraints effectively sterilise the land for residential development. "Improved design outcome for the site that is compatible with the character of the area". A positive statement. "Mitigation measures effectively maintain the amenity of surrounding area". A positive statement. "Serves the needs of people in the residential areas". A positive statement. "Does not have an unacceptable impact on the adjoining land by way of shadowing, invasion of privacy, noise and the like". A positive statement. We then have in items 5.1, 2, 3 and 4, further support for those matters. 125Mr Galasso noted (T p44 L10) that satisfaction involves "a question of judgment, a question of fact and degree of discretion in the hands of the consent authority". In relation to Council's "satisfaction" of the zone objectives, he submits that although "consistency" was referred to in some of the Council's materials, and in its meetings, it ultimately had the correct test. He said (T p 45 L16): It is a nonsense to say that they were misdirected by something someone said many months before and that that's somehow poisoned the waters for ever and a day. 126When he resumed his oral submissions on Day 2 of the hearing, Mr Galasso demonstrated, by analysis of the transcript of the Council discussion, that the councillors "in fact debated each of the objectives and they were alive to them" (see T 11.5.12 from p 7 L49 to p 9 L12). The Council does not, in his submission, have to make a two-stage decision, separating the "satisfaction" test from consideration of the merits (T 11.5.12 pp 14-16).

Does cl 66 require satisfaction of all 2(a) zone objectives? 127In North Ocean Shores (at [19]) Preston ChJ thought that only relevant zone objectives needed consideration pursuant to a clause, which like cl 66, did not have an express reference to "relevant" zone objectives. However, in Clifford Stein J (at 249) said in relation to a clause which provided power to grant consent for development that would otherwise have been prohibited (emphasis mine): ...Unless the discretion arising under cl 14(3) could be exercised the application must fail...Therefore, in order that the development become permissible (as opposed to prohibited) the Council had to be satisfied as to each subparagraph of cl14(3). These embrace the aims of the LEP in cl2 and, by reason of cl10(3), the objectives of the 2(g) zone. It was necessary that the Council address itself to each of these matters (in so far as relevant) in order to form the requisite opinion and satisfaction. This, it must be stressed, is a separate consideration from the s90 merit matters because cl14(3) concerns the permissibility of the proposal. 128His Honour then went on to consider whether each subparagraph of cl 14(3) was satisfied. 129Various other cases have considered similar clauses, but I do not find any to be directly on a par with, or of particular assistance in, this matter. Each statutory instrument must be considered according to its own terms, and applied to the circumstances at hand. 130Clause 66 opens the door for the grant of consent to development, which, without the benefit of it, would be prohibited, and I am of the opinion that it is, therefore, both logical and justified that that clause imposes a stricter test than cl 8. Also, the deliberate use of the word "relevant" in cl 8, compared with its absence in cl 66, cannot be disregarded. 131Accordingly, I accept Mr Wilson's submission, that cl 66 requires the relevant consent authority, in this case the Council, to reach a state of satisfaction as to all of the objectives of the 2(a) zone.

Did Council form the requisite opinion regarding satisfaction (and consistency) of all the 2(a) zone objectives? 132Where the materials before the consent authority do not contain a reference, whether direct or implied, to the objective which requires consideration, an inference may be drawn that it was not considered when the decision to approve (or deny) consent was made: see Boral at [93], Arrawarra, and Hortis. 133Furthermore, the "mere existence" of material, "without any analysis of it for the purpose of satisfying the requirements" of the clause is insufficient (North Ocean Shores at [77], Hortis at [54], and Clifford at p 249). 134An active intellectual process is required, where more "than a mere formalistic reference" is made to the relevant considerations (see Capital Airport Group at [98]-[100], and the authorities cited therein). 135The presumption of regularity also applies to Council decision making (see the decision of the Court of Appeal in GPT RE Ltd v Belmorgan Property Development Pty Ltd [2008] NSWCA 256; (2008) 72 NSWLR 647, at [86], referred to in Boral, at [100]). 136Mr Wilson pointed out that the proposal was recommended for refusal, and argues that there is no evidence to support the formulation of the requisite opinion. He also highlighted the fact that "consistency" with the zone objectives, rather than "satisfaction" of the zone objectives, can be found in some of the Council materials and discussions. 137Although there was some inconsistency in the way that cl 66 was framed in the Council materials, I accept that cl 66 was alive in the minds of the councillors from the time the application was lodged until it was decided, and that there is ample evidence to support the finding that Council considered and engaged with that clause, as required by its terms (see for example SEE at fol 126, above at [26], the Council officers' reports at fol 823-824, at [53] above, and fol 1416 above at [65]). 138I am satisfied that all of the 2(a) zone objectives were discussed and analysed in the process of considering and determining the DA. Some (ie (b) and (d)) were given more attention than others, but there is sufficient evidence among the Council materials to support the conclusion that Council had formed the opinion that each could be satisfied by the development. 139I think it is also important to note the Court's finding that Council was aware of, analysed, and engaged with, cl 8(3), and balanced the 2(a) objectives against the 3(a) objectives, forming an opinion, prior to granting consent, as to whether the development was consistent with both sets of zone objectives.

Conclusion 140Accordingly, I have concluded that the applicant has not established any basis for the Court to find that the Council's decision to grant consent should be held to be invalid. 141The Court finds that DA2011/0040, approved by the Council on or about 18 October 2011, for the development of Lots 1 and 2 of Deposited Plan 578015 as a McDonald's restaurant, is valid. 142The formal orders of the Court are: (1)The applicant's summons issued on 22 December 2011 is dismissed. (2)Costs are reserved. (3)All exhibits are to be returned to the parties. 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. Decision last updated: 29 October 2012

(2011) 180 LGERA 343

(2008) 163 LGERA 400

(2006) 151 LGERA 229

(2009) 167 LGERA 134

(1998) 100 LGERA 365

(2002) 124 LGERA 147

(2001) 113 LGERA 321

(2000) 111 LGERA 181

(2006) 143 LGERA 277

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