Progress & Securities Pty Ltd v North Sydney Municipal Council

Samuels JA at p.221 details the argument advanced by the Respondent Council at first instance before this Court in terms which are quite similar to the argument advanced by the Respondent in these proceedings:- "It was submitted for the Council (the respondent in the Court below) that the application under s.102, and the appeal from its rejection, were alike misconceived, because s.102, on its true construction, did not cover the deletion of a fundamental condition to which the applicant had objected even before the consent was granted. Hence, so the argument ran, the company's only proper course had been to mount an appeal under the Environmental Act, s.97, which it had not done; and that right had been lost by effluxion of time."

At p.222 Samuels JA states the following intermediate conclusion (which in my opinion is relevant to the present case):-

"In my opinion it was clearly open to the company to seek 'a modification' under s.102 and his Honour had power to order a 'modification'."

However in the event His Honour ultimately concluded (p.224) that the condition sought to be modified (by deletion) being a "condition upon which the consent wholly depended" was not a "detail of the consent" and hence fell outside the scope of the modification power conferred by s.102(1).

Whereas the ultimate conclusion in Ilenace may have been rendered irrelevant by the amendment to s.102(1) (by omitting the words "details of") made by the Environmental Planning and Assessment (Amendment) Act 1985 I do not think that that amendment affected what I have earlier described as His Honour's "intermediate" conclusion.

In Valhalla the Chief Judge upheld an appeal pursuant to s.56A of the Land and Environment Court Act 1979 against the Assessor's decision that the Court lacked power or jurisdiction to grant a 'modification application' under s.102 because to do so would result in an intensifying of an existing use for which activity at that time the Act made no provision: see p.246.

The Chief Judge at p.246 states the following general conclusions as to the scope of the "modification" power conferred by s.102(1):-

"More significantly, however, there is nothing in s.102 of the Act which requires a conclusion that the power to amend consents is limited to those consents not involving 'existing use' rights."

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"Section 102 provides that a consent may be modified. The constraints on the power to modify the consent are to be found in the section itself (see s.102(1)(a), (b) and (c)). If the development to which the consent as modified relates is substantially the same development and if the court is satisfied that no prejudice will be caused to any person who objected to the development application the subject of that consent, and, if necessary, there has been consultation, then the court is empowered to and may modify the consent."

It may be accepted in favour of the Respondent's submissions that neither Ilenace nor Valhalla deals directly or comprehensively with the inter-relationship of ss.97 and 102. Indeed in Ilenace Samuels JA at p.225 acknowledges that relief available to a dissatisfied applicant under s.97 may be wider than that available under s.102 although Mahoney JA at p.227 draws attention to an incident of a s.97 appeal (against the imposition of a condition requiring a cash contribution) namely the consequence of success in the appeal on the "validity or continuing validity of the consent". (It is not clear whether His Honour was contemplating that such a consequence (of Pyrrhic victory) would not be relevant to a s.102 application. However such a consequence might not have to be contemplated because of the inherent limitations involved in the concept of 'modification"). Moreover I do not accept the Applicant's broad submission that s.102 provides a truly alternative right of appeal to that provided by s.97. (This is becau se of the nature of the s.102 power which I shall shortly discuss).

However even on this basis I am unable to accept the Respondent's fundamental submission that the modification power conferred by s.102(1) does not apply to an application based upon dissatisfaction with the consent authority's determination of a development application where that dissatisfaction would or could otherwise form the basis for an appeal to this Court under s.97. In my opinion there is no warrant for such a constrained or limited interpretation of the scope of the power conferred by s.102(1). I emphasise, however, that this conclusion solely addresses the scope of power. For reasons that I will soon develop I am of the opinion that much of what the Respondent has relied on supporting its submission is relevant to the question of discretion relating to the exercise of that power.

Accordingly I find that the 'modification' power conferred by s.102(1) is available to the Applicant in the present case. This in truth is to say no more than that to delete condition D22 from the relevant development consent herein is to modify that consent.

This question involves a consideration of 2 issues debated at the hearing namely -

(i) Has the Applicant shown cause for the modification to be granted?

(ii) Even if, the Applicant shows cause should the Court in the exercise of its discretion grant the modification sought?

Since I have come to the conclusion that the Applicant should be denied relief on discretionary grounds I shall first consider issue (ii). This treatment also has the advantage of relating the discretionary considerations to the question of the scope or extent of the power conferred by s.102(1). In the present case, in my opinion, such considerations are obviously very closely related.

I have adopted the formulation "show cause" not only because cl.47(1)(d) of the Environmental Planning and Assessment Regulation 1980 requires an application under s.102(1) to "show cause why the consent authority should modify the development consent", but because in a situation where the consent authority opposes the modification, the Applicant clearly carries the onus of establishing his case for modification.

It should be noted at this stage (although it will later be necessary to refer to the evidence in greater detail) that the cause sought to be shown by the Applicant is that condition D22 should not have been imposed on the grant of development consent either because it was an ultra vires condition or an unreasonable condition.

Although the Applicant concedes that the Court retains a discretion in the exercise of the 'modification' power conferred by s.102(1) it submits that if the Court upholds the Applicant's case that Condition D22 was invalidly or unreasonably imposed it would not be a proper exercise of discretion for the Court to withhold relief.

However, in my respectful opinion, this submission involves asking the wrong question concerning the impact of discretionary considerations relevant to s.102 in a case such as the present where the sole basis advanced in support of the modification application is the assertion that the relevant condition should not have been imposed on the grant of the relevant development consent either because the condition was ultra vires or unreasonable. In such a case the more appropriate question, in my opinion, is whether discretionary considerations require, as a matter of principle, based upon the nature of the case sought to be made out by the Applicant, a rejection of that case without embarking on an examination of the particular merits of that case.

In stating this conclusion I emphasise the nature of the modification power conferred by s.102 and the mischief it was designed to overcome. Prior to the enactment of the Environmental Planning and Assessment Act 1979 planning legislation in N.S.W. did not provide express power for modification of a development consent at the behest of the applicant or person having the benefit of the development consent. Thus where a variation was sought to a development consent it would generally be necessary for the applicant to make a further development application to obtain the required development consent.

This same position obtained in New Zealand and is succinctly described by Palmer "Planning and Development Law in New Zealand" Volume 1 at p.456:-

"Where a variation is not within the scope of the original consent, there is no bar at law to prevent further or successive planning applications being made for cumulative consents to add to, vary or substitute the original consent. Under the 1953 Planning Act this was the only procedure available to alter the terms of a consent but the 1977 Act has introduced a formal procedure pursuant to s.71."

The position (with its potential for inconvenience) in N.S.W. was somewhat mitigated by two decisions of the Court of Appeal in 1972 and 1973 (Mangano v. Holroyd Municipal Council 26 LGRA 357 and Page v. Drummoyne Municipal Council 28 LGRA 263) which gave effect to a standard statutory planning provision so that generally speaking the grant of building approval under Part XI of the Local Government Act 1919 also operated as the grant of development consent under the relevant town planning legislation.

This was the background to the enactment of s.102 of the Environmental Planning and Assessment Act, and it is not difficult to discern the mischief which that section was intended to remedy, namely the necessity for the making of further and successive development applications and for the granting of further development consents to vary the terms of a development consent. Although the remedy provided by s.102 avoids the necessity for the obtaining of a further development consent to secure a modification of an existing development consent it does not abrogate the right to seek to obtain successive development consents in respect of the same land - see s.102(6).

It is to be noted that although s.102(1) specifies limitations on the exercise of the modification power thereby conferred in permissive and discretionary terms ("may modify") it does not, unlike s.90 (the determination of a development application) expressly stipulate the considerations relevant to the exercise of the modification power. This raises the question as to what discretionary considerations are relevant to an application made under s.102(1). It is at this point where I find relevant and decisive much of the substance of the Respondent's submission. Though that submission was directed to the question of the scope of the power conferred by s.102(1) in this case (as in many other cases) I find the questions of power and the discretionary exercise of that power to be substantially inter-related and over-lapping. Here I recapitlate the substance of the Respondent's argument which I consider relevant to the question of discretion. The Applicant in the present case promotes its application for modificati on solely on the ground of alleged invalidity or unreasonableness (not in the "Wednesbury" technical sense of that term) of the Respondent's decision to impose the condition when originally granting the development consent. Yet the Applicant accepted the condition by paying the cash contribution without protest and by carrying out the approved development. The Applicant had by virtue of s.97 of the Environmental Planning and Assessment Act a comprehensive right of appeal if it was dissatisfied by the Respondent's determination of the development application. It did not exercise that right of appeal. Belatedly (ie after the fulfillment of the condition by the payment of the cash contribution by the Applicant without protest, after construction of the approved development was well advanced and after the expiration of the statutory limitation of 12 months prescribed by s.97 for instituting an appeal) the Applicant makes its application under s.102.

A matter of particular importance that attracts most obvious attention as being relevant to the exercise of the statutory power to modify the development consent is the fact that the Applicant's case relies on nothing occurring subsequently to the grant of development consent which might justify or require some reconsideration of its terms (eg a change in circumstances, supervening impossibility, or unanticipated problems in the building construction process etc). Instead the Applicant's case relies entirely upon matters occurring in, and bearing upon, the Respondent's grant of development consent. Stated baldly the Applicant's case depends entirely upon it successfully impugning the validity and reasonableness of an element of the Respondent's decision which granted the development consent which the Applicant has implemented. Thus the Applicant has taken the benefit of the grant of development consent but seeks to be relieved on one of the burdens of that grant.

Although the operation of s.102 is not limited to cases involving a change in relevant circumstances occurring after the grant of development consent that type of case obviously is contemplated by the section. In this respect it is interesting to note that s.71 of New Zealand's Town and Country Planning Act 1977 confers on an owner or occupier of land the subject of a development consent the right to apply for "the variation or cancellation of any condition, restriction or prohibition imposed in respect of the consent, on the grounds that a change in circumstances has caused the condition, restriction or prohibition to become inappropriate or unnecessary" (subsection (1)).

Speaking of this section the New Zealand Planning Tribunal in Vidot v. Palmerston North City Council (1983) 9 NZTPA 189 stated at pp.190/191:-

"In order to apply s.71 of the Act it must be demonstrated to the council or the Tribunal that there is a change in circumstances which "has caused the condition ........ to become inappropriate or unnecessary."

If there is no change of circumstances within the meaning of s.71 then the section cannot apply. It is certainly not framed in a manner which permits an applicant to take advantage of a consent granted and then endeavour to attack an original condition imposed, on the basis that it should not originally have been imposed. If the applicant does not like a condition then the appropriate course is to appeal at that stage.

In the present case the reasons advanced by the appellants for the cancellation of the condition, with one exception, relate to matters which applied at the time of the original application for dispensation:

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"None of the foregoing factors are relevant within the meaning of s.71. None of those factors indicate a change in circumstances, and there is certainly no suggestion that they have caused the condition to become inappropriate or unnecessary."

More recently in Greta Point Tavern Ltd. v. Wellington City Council (1986) 11 NZTPA 332 the New Zealand Planning Tribunal has gone further by rejecting an application for variation of a condition on the ground that the change in circumstances was not "unforeseen" (p.334) adding the observation "we ............... consider the appellant as an experienced operator should have been fully aware how the area would function ........".

Obviously these decisions are not directly in point to s.102. However they are cited in illustration of the principle (which in my opinion is capable of operating outside the New Zealand statutory framework) that an application for modification of a development consent must be based upon something more than the state of affairs existing at the time the development consent was granted, and known to and accepted by, the Applicant.

Perhaps more relevant for present purposes is the decision of Wells J. in Adelaide Pistol Club Incorp. v. District Council of Munno Para (1981) 45 LGRA 119. In that case the question was whether the South Australian Planning Appeal Board had the jurisdiction and power to vary (by deleting a condition) the terms of a development consent it had granted some years earlier. The relevance of this decision is not so much the implication of such a power vesting in the Board but the limitations on, and nature of, that power that His Honour considered appropriate.

At p.122 His Honour expressed the following tentative conclusions:-

"Mr. Hayes presented a most useful and important argument on the second of the issues just referred to. In his submission, notwithstanding that the jurisdiction of the board is exclusively statutory, the language of the relevant provisions of the Planning and Development Act is sufficiently wide and flexible to accommodate a power, which ought to be implied, that corresponds to a court's power to vary the terms of an order where, before it has been fully executed, changed circumstances render such a variation just and expedient. Such a power would not, of course, authorize the board to recall the essential core of its determination, but would empower it, where circumstances have undergone a substantial change since the determination was published, to give effect to its intentions in the changed circumstances. I found Mr. Hayes's arguments interesting and pertinent. I forbear to examine them, and the authorities he referred to for their support, only because it is unnecessary to pronounce upon them in order to do justice in this case. As at present advised, I am disposed to think he is right, but I should prefer to reserve a final judgment until the issue arises in a case in which it must be resolved, and an even fuller debate has been devoted to it, coupled with more prolonged research.

I should, however, make one reservation. I am of the opinion that a Planning Appeal Board could not, by exercising an implied power of the kind to which Mr. Hayes refers, declare null and void a condition made by the same board, whether differently constituted or not. If this Court were to endorse such a procedure it would, in effect, be holding that there can be an appeal from Caesar to Caesar. To vary ancillary conditions that are, ex hypothesi, valid, in order more effectively to implement the fundamental purpose of an existing determination is one thing; to challenge the legal validity of a determination, or part of one, in its original form is quite another."

In a subsequent judgment in the case His Honour was asked to "definitively rule" on the question of the power of Board to vary the terms of a planning consent it had earlier granted. At p.125 His Honour having emphasised that "it is not possible to lay down anything other than a board principle" went on to state the following conclusion:-

"Having regard to the objects and structure of the Planning and Development Act, in general, and of the function and responsibility of the Planning Appeal Board, in particular, it seems to me inconceivable that there should not be imported into the Act the implied conferment of a power of the nature and purview referred to in the first judgment in this matter.

The character of planning work is such that it comprehends decisions of broad principle which must be implemented with some particularity. It is wholly consistent with that character that a decision on a point of principle may remain unchanged, but its implementation may require variation in detail in order to accommodate the fundamental purpose of the decision to circumstances that have undergone a change not reasonably capable of being resisted. It would, in my opinion, frustrate the determinations of the board if it were not assigned, by analogy with courts, subsidiary powers to make those variations, whenever it is just and convenient to do so, in order to carry the central purpose of a determination into proper and complete effect in altered circumstances."

Although this decision has been critised (Gifford's "Town Planning Law and Practice" (1987) paragraph 58-170) the criticism is not directed to His Honour's conception of the Board's power of variation being limited to cover cases of "changed circumstances" not involving "the recall of the essential core of its determination".

In the present case it is neither necessary nor proper to hold, nor do I hold, that the power conferred by s.102(1) is limited to situations involving changed circumstances from those existing at the time that development consent was granted. What however, I do hold, is that the absence of any changed circumstances or the absence of any new or additional material relevant to the Respondent's determination granting the relevant development consent (but overlooked by the Respondent) is a relevant consideration in the exercise of the statutory discretion.

A related discretionary consideration that weighs strongly against granting the application in the present case is the conduct of the Applicant in accepting the benefit of the development consent but seeking to be relieved of the burden created by the imposition of Condition D22, not only belatedly but after the burden had been accepted by the Applicant. This type of consideration is similar to the equitable notion that "anyone who accepts the benefit of a transaction must also accept its burden" discussed at paragraph 4330 in "Equity Doctrines and Remedies" (2nd ed.) by Meagher Gummow and Lehane and to the attitude often taken by Courts exercising statutory jurisdiction to modify or extinguish restrictive covenants (eg under s.89(1) of the Conveyancing Act 1919) to applications made by original covenantors not long after entering into the covenants - eg see "Easements and Restrictive Covenants in Australia" by Bradbrook and Neave at paragraphs 1936 and 1942.

The discretionary consideration I rely upon in this case does not depend upon the principles established in the fields of equity and property law for I am conscious of the warning by Lord Scarman in Pioneer Aggregates Ltd. v. Secretary of State for the Environment (1985) AC 133 at p.141 that town planning legislation "is a field of law in which the courts should not introduce principles or rules derived from private law unless it be expressly authorised by Parliament or necessary in order to give effect to the purpose of the legislation".

However since in s.102(1) the Legislature has deliberately conferred an undoubted yet undefined discretion and left to the Court the proper elucidation of the elements and bounds of that discretion it is, in my opinion, natural and proper for the Court in essaying the task of elucidation, to have regard to established legal principles in related or analogous fields of law in the knowledge that its task is to effect to the purpose of the Environmental Planning and Assessment Act.

I should interpolate, at this point, that I do not find Mr. Rommel's evidence enables the Applicant to avoid the legal consequences of its conduct that I have just described.

Mr. Rommel is the principal of Peter Rommel and Associates Pty. Limited which carries on a well known and established architectural practice. Mr. Rommel on behalf of the Applicant made the relevant development application herein and obtained the relevant development consent. Mr. Rommel gave the following testimony:-

"Q. ......... Did you talk to the Council about Condition D22 .......? A. No.

Q. And you did not ask for any review of it or lodge any appeal against it, is that correct? A. No.

Q. Why didn't you do that? A. Well, at that time I wasn't aware that one could object to the payment of the contribution assessed by the Council under Section 94."

After being shown a copy of the Respondent's notice of determination granting the relevant development consent herein Mr. Rommel was asked:-

"Q. ........ Note C says: Section 97 of the Act confers on an applicant who is dissatisfied with the determination of the consent authority a right to appeal to the Land and Environment Court exercisable within 12 months after receipt of this Notice. Now were you conscious of that note at the foot of the notice of determination when you received it? A. Not specifically in respect of the contribution. I am aware that any development approval which contains a condition, that one has 12 months to lodge an appeal.

Q. But did you think the right to lodge an appeal referred to in that note did not extend to matters requiring payment of money? A. That's correct, yes, at that time."

Mr. Rommel was not cross-examined on this testimony and though I find it very surprising that Mr. Rommel, as an experienced practicing architect involved in the development industry, did not appreciate that the right of appeal conferred by s.97 of the Environmental Planning and Assessment Act extended to a condition of development consent requiring the payment of money I accept Mr. Rommel's testimony. However that testimony does not establish the state of mind or knowledge on the question of appeal rights under s.97 of his client, the present Applicant, either at the times deposed to by Mr. Rommel (confined to the time he received the notification of the Respondent's determination) or at other material times (that were not deposed to).

This brings me finally to state my conclusion that for the foregoing reasons, on discretionary grounds, the s.102(1) application should be dismissed. In my opinion it would be clearly contrary to the public interest in the proper and efficient administration of the Environmental Planning and Assessment Act to allow s.102(1) to be used in the manner sought by the Applicant in the present case.

This conclusion makes it strictly unnecessary for me to examine in detail the merits of the Applicant's case, which can be briefly outlined as follows.

In support of its allegation that Condition D22 was ultra vires the Applicant's case essentially relies upon the written content of the Respondent's file pertaining to the relevant development consent. It was submitted that I should infer from this material that the Respondent failed to form the requisite opinion under s.94(1) which is the condition precedent to the imposition of a condition such as Condition D22.

In support of its allegation that the condition was unreasonable the Applicant's case relies upon the opinion of Mr.Player, a Consultant Town Planner.

The Respondent sought to rebut the Applicant's case by calling evidence from Mr. Nangle the Respondent's Assistant Director of Development and Planning and from Miss Keene formerly the Respondent's Director of Community Development. Each had been involved in the processing of the development application to which the Respondent had granted the relevant development consent.

In view of my conclusion on discretionary grounds I do not think it appropriate that I determine in these proceedings the question of the validity or reasonableness of Condition D22.

Accordingly I order that the appeal under s.102(5) of the Environmental Planning and Assessment Act 1979 be dismissed.

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.