Ricola Pty Ltd v Woollahra Municipal Council

Land and Environment Court (NSW)|2020-12-10

The applicant's submissions

Ricola makes a number of submissions in support of the bulk, scale and height of the proposed development, and submits that both of the written requests adequately establish that compliance is unreasonable and unnecessary, and set out sufficient environmental planning grounds.
Ricola submits that the emphasis in the WLEP 2014 is on the desired future character, which presents as a consistent theme throughout the objectives of the standards and the zone. One of the objectives of the B2 Local Centre zone is to "ensure that development is of a height and scale that achieves the desired future character of the neighbourhood". Further, the single objective of the FSR development standard is to "ensure that buildings are compatible with the desired future character of the area in terms of bulk and scale", which is in the exact same terms as the precondition to cl 4.4A, which concerns the bonus FSR for the corner site. One of the objectives of the height development standard also concerns the desired future character, to "establish building heights that are consistent with the desired future character of the neighbourhood".
In understanding the term "desired future character", Ricola refers to the decision of Preston CJ in Woollahra Municipal Council v SJD DB2 Pty Limited, in which his Honour considered that the term can be construed as "permitting regard to be had to matters other than only the development standard" (at [63]). He found that the matters that may be taken into account are unconfined (at [54]), and can include approved development that contravenes the development standard (at [63]).

The Council's submissions

The Council submits that the written requests concerning the breach of the height and FSR development standards do not establish that compliance is unreasonable or unnecessary, or that there are sufficient environmental planning grounds to justify the contravention of the standards. Further, the Council submits that the proposed development is not consistent with the objective to "minimise the impacts of new development" as a result of the impact of the additional height on the disruption of views and visual intrusion.
In relation to the breach of the height development standard, the Council submits that the request does not adequately demonstrate that compliance with the development standard is unreasonable or unnecessary in the circumstances.
In respect of the request's argument that compliance is unreasonable or unnecessary because the proposed development achieves the objectives of the standard, the Council submits that the request does not actually address the question as to whether the proposed development minimises the impacts of new development on adjoining or nearby properties from the disruption of views and the related visual intrusion. Instead, the request considers the planning principle concerning view sharing, and considers whether the view loss is reasonable. The Council submits that the non-compliance with the height development standard exacerbates the disruption of views caused by the development, and that disruption cannot be considered to be minor or trivial. The Council submits that the result of the views being lost by the development at 28-34 Cross Street is that the surviving views will be more highly prized, and their loss ought not be discounted. The Council submits that the fact that the experts agree that the development proposes a built form that is compatible with the desire future character does not obviate the requirement to achieve all of the objectives of the height development standard, and that no lesser weight should be placed on the objective to "minimise the impacts" due an agreement that the built form is consistent with the desired future character.
With respect to the argument in the written request that compliance is unreasonable and unnecessary as the "underlying objective has been defeated or thwarted", the Council submits that there is no single underlying objective of the height development standard, but there are specific multiple objectives. Further, the Council relies on the evidence of Mr Newbold that the site is not within the same contextual circumstances as the approvals on Cross Street, and the recent six-storey developments "do not establish relevant precedents for properties which flank Bay Street" (Ex 3 p 10).
Further, with respect to the argument in the written request that compliance is unreasonable and unnecessary as the standard has been abandoned or destroyed, the Council submits that the lack of precedent to which Mr Newbold refers makes it clear that, as Clay AC expressly found, any abandonment is confined to the block of Cross Street on its southern side and does not apply to Bay Street.
The Council submits that the written request concerning the height development standard does not establish sufficient environmental planning grounds to justify the contravention. The Council says that the request, instead, restates the requirement of the objective concerning consistency with the desired future character, and does not establish that a corner building needs the additional height to emphasise the corner. The Council relies on the evidence of Mr Newbold that emphasis on the corner building could be achieved with a five-storey development. The Council points out that this is the same as the evidence that was given by Mr Lidis in the hearing before Clay AC in SJD DB2 Pty Ltd v Woollahra Municipal Council. The Council submits that the other environmental planning grounds relied upon simply restate the requirements for the development and promotes its benefits, without any evidence as to why those benefits would not be achieved with a compliant development.
The Council also submits that the Court could not be satisfied that the development meets the requirements of cl 4.6(a)(ii) on the basis that the development is not consistent with the fourth objective of the height development standard, as a result of the impact caused by the disruption of views and visual intrusion.
With respect to the written request concerning the breach of the FSR development standard, the Council submits that the request does not establish sufficient environmental planning grounds to justify the breach of the standard. The Council says that the non-compliant FSR in question is represented by the upper portion of the building, comprising the sixth storey. It submits that the environmental planning grounds relied upon do not establish why that upper portion is justified, including why the additional floor space is required to emphasise the corner or achieve the desired future character.

The written request for the height development standard does not adequately address the required matters

For the following reasons, I am not satisfied that the written request concerning the height development standard has adequately addressed the matters required to be demonstrated by cl 4.6(3). The request has not demonstrated that compliance with the height development standard is unreasonable or unnecessary on the basis of any of the three reasons advanced. Further, although the request has advanced environmental planning grounds, those grounds are not sufficient to justify the contravention of the standard.

The written request does not demonstrate that compliance is unreasonable or unnecessary

Firstly, the request has not demonstrated that the proposed development achieves the objectives of the height development standard notwithstanding the non-compliance. This is the first reason advanced in the request to demonstrate that compliance with the height development standard is unreasonable or unnecessary in the circumstances of the case, and it reflects the first of the five ways of establishing that compliance is unreasonable or unnecessary, as described by Preston CJ in Wehbe v Pittwater Council (2007) 156 LGERA 446; [2007] NSWLEC 827. In explaining the premise for this way, his Honour says (at [43]): "43 The rationale is that development standards are not ends in themselves but means of achieving ends. The ends are environmental or planning objectives. Compliance with a development standard is fixed as the usual means by which the relevant environmental or planning objective is able to be achieved. However, if the proposed development proffers an alternative means of achieving the objective, strict compliance with the standard would be unnecessary (it is achieved anyway) and unreasonable (no purpose would be served)."
The relevant environmental and planning objectives for the applicable height development standard are the stated objectives in cl 4.3 of the WLEP 2014. Compliance with the height development standard is fixed as the usual means by which each of the objectives is able to be achieved. This is true of each of the objectives. That is, compliance with the standard is the usual means of achieving "building heights that are consistent with the desired future character…" (objective (a)) as well as minimising "the impacts of new development on adjoining or nearby properties…" (objective (d)).
In order to establish that these objectives are met notwithstanding the non-compliance, there must be some alternative means by which each of the objectives are achieved, either by design or by circumstance. The written request advances such means in relation to objective (a), by setting out what the desired future character of the neighbourhood is, and describing how the six-storey design of the proposal achieves that desired future character (see Ex E p 8). Similarly, the written request simply advances such means by describing the circumstances that result in achieving objective (e), as the proposed development and the height variation does not affect any public views from the public domain.
However, the request does not advance any means by which the proposed development achieves the objective to "minimise impacts of new development on adjoining or nearby properties" by reference to disruption of views or visual intrusion, and therefore does not establish that objective (d) is achieved notwithstanding the contravention. In considering objective (d), I do not accept the submission of Ricola that its intent should be narrowed in any way by a change in the desired future character brought about by recent approvals in Cross Street. I consider that objective (d) is a discrete objective that concerns amenity impacts, and the impact of the breach of the height development standard is not an impact that is anticipated merely by reason of there being a change to the desired future character of the neighbourhood. As such, to demonstrate that the objectives are met notwithstanding the non-compliance, the request needs to put forward the means by which the proposed development will "minimise impacts of new development on adjoining or nearby properties from disruption of views, loss of privacy, overshadowing or visual intrusion". The request fails to do so, as it does not address how the proposed development will minimise impacts by reference to disruption of views or visual intrusion. Instead, its focus is on whether the view loss is reasonable, taking into account the planning principle in Tenacity Consulting v Waringah. In setting out its analysis within the scope of the planning principle, the only means advanced for minimising the impact is the "high quality of the architectural design" (Ex E p 15). This is not sufficient to describe how the development minimises impacts by reference to disruption of views or visual intrusion, and there is nothing else within that analysis that describes how the proposed development does so.
To establish that the objective "to minimise impacts" is achieved, it is not sufficient for the written request to justify the reasonableness of the disruption of views, loss of privacy, overshadowing, or visual intrusion in circumstances where there is an actual and measurable impact occasioned by those sources and that impact is exacerbated by the breach. There is an actual and measurable impact on the nearby property at Unit 7C at 2-22 Knox Street by the disruption of views and visual intrusion by the proposed development, which the request describes as "moderate". That impact is one that is not anticipated by the numeric control, as the impact is greater than that of a complying development and will result in a loss of the view of the entire ridgeline (other than the keyhole view). If the development complied with the development standard, views of the vegetated ridgeline would be retained. The request has provided no means by which that actual and measurable impact is minimised by the proposed development. The request, therefore, has not established that objective (d) has been met notwithstanding the non-compliance with the development standard.
In reaching this conclusion concerning this aspect of the written request, I do not accept the submission of Ricola that the objective to minimise impacts is achieved by the fact that there are no issues concerning privacy or overshadowing, that the particular property is not an "adjoining" property, or that the views are from bedrooms. Objective (d) is concerned with minimising the impact by reference to disruption of views, loss of privacy, overshadowing, or visual intrusion, and is not confined to the consideration of that impact on living areas. Nor does the objective place any greater weight on adjoining neighbours.
Secondly, the request does not demonstrate that the objective or purpose of the height development standard would be defeated or thwarted if compliance was required. This is the second reason that the request puts forward as a basis upon which compliance is unreasonable or unnecessary. The request fails to establish this reason. The request assumes, wrongly, that the only relevant underlying objective is to achieve the future character, which is for "a coherent street scale, compatibility with the urban fabric and coherent street definition". However, there are multiple stated objectives for the height development standard and not a single underlying objective. This includes the objective to minimise impacts, which is discussed above. Further, even if the single underlying objective was correctly assumed, the written request does not actually establish, in fact, that compliance with the development standard would thwart this underlying objective. The request contains a mere statement without any demonstrative analysis as to why a complying development could not achieve "a coherent street scale, compatibility with the urban fabric and coherent street definition". The request has therefore not established that the underlying objective or purpose would be defeated or thwarted if compliance with the height development standard is required.
Thirdly, the written request for the height development standard does not establish that the development standard has been abandoned or destroyed. This is the third reason that the request puts forward as a basis upon which compliance is unreasonable or unnecessary. In seeking to establish the abandonment, the request relies on the findings of Acting Commissioner Clay in SJD DB2 Pty Ltd v Woollahra Municipal Council.
However, the findings of the Commissioner concerning the abandonment of the height development standard on Cross Street do not apply to the site the subject of the proposed development. The first reason that the findings do not apply to the site is that the standard referred to as being abandoned by the Commissioner is not the same standard that applies to the subject site. The development standard that is referred to by the Commissioner is a height development standard of 14.7m, in the area marked N5 on the height of buildings map. The development standard that applies to the site is a height development standard of 18.1m, in the area marked P3. A finding that one height development standard has been abandoned does not mean that another height development standard referable to another site has been abandoned. The second reason that the findings of the Commissioner concerning the abandonment do not apply to the site is because the findings are confined to the block of Cross Street, and do not extend to the corner sites that front Bay Street and Knox Lane. This is confirmed by his observations that the evidence concerning the corner site, where the proposed development is located, was that it could still comply with the applicable standard and achieve a prominent corner building design (see [73]). For these reasons, the reliance on the decision in SJD DB2 Pty Ltd v Woollahra Municipal Council in the written request is not sufficient to establish that the height development standard that applies to the site has been abandoned or destroyed, and the written request otherwise fails to establish that the standard applicable to the site has been abandoned or destroyed.
The request has therefore failed to demonstrate that compliance with the height development standard is unreasonable or unnecessary through the three reasons advanced. As there are no other reasons put forward in the request as to why compliance is unreasonable or unnecessary, I am not satisfied that the written request has adequately addressed that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case. As such, the satisfaction required by cl 4.6(4)(a)(i) of the WLEP 2014 has not been met and there is no power to grant development consent to the proposed development. This alone is a sufficient basis upon which the development application must be refused.

The written request does not demonstrate that there are sufficient environmental planning grounds to justify the

Additionally, I am not satisfied that the environmental planning grounds advanced in the written request are sufficient to justify the contravention of the height development standard. In discussing the requirement to demonstrate sufficient environmental planning grounds in Initial Action Pty Ltd v Woollahra Municipal Council, Preston CJ stated: "the environmental planning grounds advanced in the written request must be sufficient "to justify contravening the development standard". The focus of cl 4.6(3)(b) is on the aspect or element of the development that contravenes the development standard, not on the development as a whole, and why that contravention is justified on environmental planning grounds."
I consider that the first, second and fourth grounds advanced in the written request to justify the contravention (Ex E p 20), which are similar in terms, constitute an environmental planning ground. Together, they clearly outline how the additional height responds to the height and scale of adjoining approved developments and also accentuates the corner.
However, this ground is not sufficient to justify the extent of the contravention of the standard. The aspect of the proposed development that contravenes the standard is not just the numerical height or the number of storeys. The extent of the breach above the height development standard can be quantified in both its lateral and vertical extent. The request fails to outline how the environmental planning ground advanced justifies both the lateral and vertical extent of the breach of the height development standard. As such, I cannot be satisfied that the request demonstrates that this is a sufficient environmental planning ground to justify the lateral and vertical extent of the contravention of the standard, which extends laterally across more than half of the site and vertically up to 2.9m above the standard.
The remaining grounds that are set out in the request to justify the contravention fail to provide a nexus between the stated environmental planning ground and the breach of the height development standard. That is, there is nothing that tethers the stated environmental planning ground with the contravention of the development standard. As such, none of the remaining environmental planning grounds are sufficient to justify the contravention of the height development standard.
For those reasons, I cannot be satisfied that the request demonstrates that there are sufficient environmental planning grounds to justify the contravention of the height development standard and for this reason also I do not reach the state of satisfaction required by cl 4.6(4)(a)(i).

Outcome of the appeal

Having not reached the state of satisfaction required by cl 4.6(4)(a)(i) concerning the contravention of the height development standard, cl 4.6(4) of the WLEP 2014 makes it clear that development consent must not be granted. Accordingly, there is no power to grant development consent and the development application must be refused.
The Court orders that: 1. The appeal is dismissed. 2. The development application for the demolition of the existing building and the construction of a six-storey shop top housing development at 49-53 Bay Street, Double Bay, is refused. 3. The exhibits are returned, except for Exhibits 2, A, E, P and K.

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Judgment

COMMISSIONER: Bay Street runs from New South Head Road to the south, to Double Bay wharf in the north, and much of its length forms part of the local centre of Double Bay. The local centre contains a number of retail and food premises which are home to a vibrant community, with some residential apartments above those ground floor premises. A number of new developments are being pursued or are under construction, which will result in increased residential apartments above ground floor commercial uses. On the corner of Bay Street and Knox Lane, known as 49 and 51-53 Bay Street, Ricola Pty Ltd ("Ricola") seeks development consent for the demolition of existing buildings and the construction of a new shop top housing development. It lodged a development application with Woollahra Municipal Council ("the Council") on 29 January 2018. These proceedings are an appeal by Ricola, pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 ("EPA Act"), against the refusal of that application on 15 August 2019.
The proposed development is a six-storey shop top housing development that presents a four-storey south-eastern frontage to Knox Lane. It comprises two basement levels accommodating 32 car parking spaces as well as bicycle and motorcycle parking, with vehicular access from Knox Lane. The ground floor level contains one retail tenancy and ancillary building services including garbage storage facilities, and the shop top housing comprises 5 levels of residential apartments with 22 units. The proposed built form is characterised by an articulated six-storey street wall to Bay Street with a curved form at the corners, with a four-storey element presenting to Knox Lane. The four-storey element is designed to continue the four-storey street wall in the building recently approved by the Court at 20-26 Cross Street in SJD DB2 Pty Ltd v Woollahra Municipal Council [2020] NSWLEC 1112.
The design of the proposed development has evolved over time. As a result of the joint conferencing of the experts, the design that is now proposed has significantly narrowed the issues in dispute between the parties.
Nevertheless, the Council remains opposed to the proposed development on the basis that it breaches both the development standards for height and floor space ratio ("FSR"). The experts agree that the proposed development is reasonably compatible with the desired future character of the neighbourhood due to the positive built form relationship with the form and scale of existing and approved buildings that are visually proximate to the site. However, they disagree on whether the proposed development minimises impacts in relation to views and visual intrusion, as required by the objectives of the height development standard, with which the development must be consistent to allow a variation to the height development standard.
For the reasons set out below, I am not satisfied that the written request concerning the height development standard has adequately addressed the matters required to be demonstrated. Accordingly, there is no power to grant development consent.

Recent approvals

Despite the four-storey control for the south side of Cross Street, the recent development consents described above at [10] have departed from these controls and changed the nature of the future character in the block of Cross Street from Bay Street, to where Knox Lane ends at its intersection with Cross Street.
As a result of those development consents, the future built form from 16 to 34 Cross Street comprises three contiguous six-storey buildings (at 16-18 Cross Street, 20-26 Cross Street and 28-34 Cross Street) designed as a four-storey street wall on both Knox Lane and Cross Street and an additional two storeys that are recessed and less visible from each of the streets.
In SJD DB2 Pty Ltd v Woollahra Municipal Council, which concerned the approval at 28-34 Cross Street immediately to the east of the site the subject of the proposed development, Acting Commissioner Clay considered that the desired future character of the area should take into account the form of the buildings approved by the Council. He stated, at [69]: "The desired future character in my opinion must take into account the form of the buildings to the east which the Council approved under effectively the same controls as present. Those buildings exceed the height and floor space ratio controls. As the Applicant pointed out in submissions, this is not a case where there is an adjacent development approved and constructed many years ago which sits as an anomaly in the street. The developments under construction represent the recently expressed attitude of the Respondent to the controls and what is desired in this part of Cross Street."
Further, he considered that there was an abandonment of the controls on the block of Cross Street, on the southern side (see [94]).
In relation to the "flow on" effect of the development at 28-34 Cross Street, the following comments were made by Acting Commissioner Clay concerning the future development of what he described as the "building to the west" (at [73]): "There was some debate about whether the building to the west, a corner site requiring emphasis, would also need to breach the controls in order to provide a proper context for the proposal. That, it was said by the Respondent, was not orderly planning. First, it should be noted cl 4.6 of WLEP is as much a part of WLEP as the clauses with development standards. Planning is not other than orderly simply because there is reliance on cl 4.6 for an appropriate planning outcome. Second, it became clear during the evidence from Mr Frecklington that the corner building to the west can be emphasised without breaching the height control, by having a greater street wall height than the four storeys street wall height proposed for the development on the Site."

The breach of the development standards

As set out above, the proposed development does not comply with either the height or the FSR development standard.
The proposed building height is 21m from the ground level to the top of the plant/lift overrun, and 19.6m from the ground level to the top of the roof. This is 2.9m above the maximum building height of 18.1m, which is an exceedance of 16%.
The proposed FSR is 3.41:1, which is 0.71:1 greater than the overall allowable FSR permitted by cll 4.4 and 4.4A of the WLEP 2014. This is an exceedance of 26%. Having regard to the quantum of the exceedance on each of the lots that form part of the site, the proposed FSR of 3.34:1 on 53 Bay Street represents a variation to the control provided by cl 4.4 (2.5:1) of 34%, resulting in an additional 400m2 of floor space. The proposed FSR of 3.52:1 on 49 Bay Street represents a variation to the controls provided by cl 4.4A (3:1) of 17%, resulting in an additional 170m2 of floor space. As such, the total floor space that exceeds the permitted FSR is 570m2.
As a result, development consent cannot be granted except in accordance with cl 4.6(2) of the WLEP 2014. Clause 4.6 provides, at (3) and (4): (3) Development consent must not be granted for development that contravenes a development standard unless the consent authority has considered a written request from the applicant that seeks to justify the contravention of the development standard by demonstrating: (a) that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case, and (b) that there are sufficient environmental planning grounds to justify contravening the development standard. (4) Development consent must not be granted for development that contravenes a development standard unless: (a) the consent authority is satisfied that: (i) the applicant's written request has adequately addressed the matters required to be demonstrated by subclause (3), and (ii) the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out, and (b) the concurrence of the Secretary has been obtained.
In considering whether the state of satisfaction required by cl 4.6(4)(a) has been met, I summarised the relevant principles in Abrams v Council of the City of Sydney [2019] NSWLEC 1583 as follows: "32 Consistent with the decision of Preston CJ in Initial Action Pty Ltd v Woollahra Municipal Council [2018] NSWLEC 118 ("Initial Action"), for there to be power to grant development consent for a development that contravenes a development standard, cl 4.6(4)(a) requires that the Court, in exercising the functions of the consent authority, be satisfied that: • The written request adequately demonstrates that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case (cl 4.6(3)(a) and cl 4.6(4)(a)(i)), • The written request adequately establishes sufficient environmental planning grounds to justify contravening the development standard (cl 4.6(3)(b) and cl 4.6(4)(a)(i)), • The proposed development will be consistent with the objectives of the zone (cl 4.6(4)(a)(ii)), and • The proposed development will be consistent with the objectives of the standard in question (cl 4.6(4)(a)(ii)). 33 Consistent with the decision of the Court of Appeal in RebelMH Neutral Bay Pty Limited v North Sydney Council [2019] NSWCA 130, the Court, in exercising the functions of the consent authority, must "in fact" be satisfied of the above matters. The state of satisfaction that compliance is "unreasonable or unnecessary" and that there are "sufficient environmental planning grounds" to justify the contravention (the first two dot points above) must be reached only by reference to the cl 4.6 request. Whilst the evidence in the proceedings can assist in understanding the request and in considering the adequacy of the request, it cannot supplement what is in the request. On the other hand, the state of satisfaction that the proposed development is in the public interest (the last two dot points above) can be reached by considering the evidence before the Court, without being limited to what is contained in the cl 4.6 request. 34 A further precondition in cl 4.6(4), which must be satisfied before the power can be exercised to grant development consent for development that contravenes a development standard, is that the concurrence of the Secretary has been obtained."

The written request concerning the breach of the height development standard

The written request concerning the breach of the height development standard is dated 18 November 2020.
The written request argues that compliance with the height development standard is unreasonable and unnecessary for three reasons. The first is that the objectives of the height development standard are achieved notwithstanding the non-compliance with the standard. In addressing the objective to minimise impacts from disruption of views and visual intrusion, the request carries out a view impact assessment based on the planning principle concerning view sharing in Tenacity Consulting v Waringah (2004) 134 LGERA; 23; [2004] NSWLEC 140.
The second reason that the request advances as to why compliance is unreasonable and unnecessary is that the underlying objective or purpose would be defeated or thwarted if compliance was required. This reason is advanced on the basis that a compliant development would have a height that is inconsistent with the approved streetscapes.
The third reason that the request advances as a basis that compliance is unreasonable and unnecessary is that the development standard has been abandoned and destroyed. This third reason is advanced on the basis of the reasoning of Acting Commissioner Clay in SJD DB2 Pty Ltd v Woollahra Municipal Council at [93]-[95] that the controls had been abandoned for this part of Double Bay.
The written request also outlines the environmental planning grounds that seek to justify the contravention of the development standard. The primary environmental planning ground relied upon is that the proposed height is compatible with the existing and approved development in the immediate context of the site, whilst also accentuating the corner relative to those developments, which achieves the intent of the Council's controls for strong corner buildings. The other environmental planning grounds relied upon in the request relate to the lack of impacts, consistency with the desired future character, and the high architectural standard of the design.
The request also deals with the requirement that the proposed development must be in the public interest by its consistency with the objectives of the zone and the objectives of the standard. In relation to the latter, the request relies on its analysis that the objectives of the height development standard are achieved notwithstanding the non-compliance with the standard.

(2007) 156 LGERA 446

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