[2003] NSWLEC 214
Kinder Investments Pty Limited v Sydney City Council (2005) 143 LGERA 237
[2005] NSWLEC 737
Reid's Farm Pty Ltd v Murray Shire Council (2010) 182 LGERA1
Source
Original judgment source is linked above.
Catchwords
[2003] NSWLEC 214
Kinder Investments Pty Limited v Sydney City Council (2005) 143 LGERA 237[2005] NSWLEC 737
Reid's Farm Pty Ltd v Murray Shire Council (2010) 182 LGERA1
Judgment (8 paragraphs)
[1]
A deferred commencement condition is not satisfied
Mr and Mrs Savellis own land at 13 Trumper Place, Menai ('the land') that they wish to redevelop. They applied for and were granted by Sutherland Shire Council ('the Council') on 19 June 2015 development consent for the demolition of the existing dwelling and the construction of a new dual occupancy. The development consent was granted subject to a condition under s 80(3) of the Environmental Planning and Assessment Act 1979 ('EPA Act') that the consent is not to operate until the applicant satisfies the consent authority, in accordance with the regulations, as to any matter specified in the conditions. The deferred commencement condition was:
"1. Deferred Commencement Condition
(a) Restriction as to User
The 'Restriction as to User' secondly referred to in Deposited Plan 259494 is to be released, varied or modified so as to permit the erection and use of the dual occupancy development as approved by this development consent. Evidence of registration of the release, variation or modification of this restriction as to user, against the title of the land, is to be submitted to Council."
As permitted under cl 95(3) of the Environmental Planning and Assessment Regulation 2000 ('EPA Regulation'), the Council specified the period within which the applicant must produce evidence to the consent authority sufficient to enable it to be satisfied as to the matter in the deferred commencement condition. This was a period of one year from the date of issue of the consent.
Mr and Mrs Savellis have not been able to produce evidence to the Council as to the matter specified in the deferred commencement condition by the date specified in the condition (19 June 2016) or at all. They have not been able to have the restriction as to user released, varied or modified so as to permit the erection and use of the dual occupancy development as approved by the development consent. Mr and Mrs Savellis have sought, by various means, to overcome this problem of being unable to satisfy the deferred commencement condition.
Mr and Mrs Savellis applied to modify the development consent under s 96(2) of the EPA Act, on or about 13 November 2015. The modification sought in the application was to "Revert to original plans submitted. Plans attached again. Supporting reason also attached." In the supporting statement, Mr Savellis requested that the Council "revert back to my original plan submitted on or about 26 March 2015." Apparently, during the Council's assessment of the development application, at the request of the Council, Mr Savellis had submitted revised plans that reduced in certain respects the dual occupancy development (the issue B plans dated 12 June 2015).
The Council granted deferred development consent to these issue B plans. In the modification application, Mr Savellis sought for the deferred development consent to be modified so as to refer to the original plans dated 26 March 2015, instead of the issue B plans dated 12 June 2015.
Mr Savellis by a later email dated 14 February 2016 amended his application for modification of the development consent so as to extend the time period specified in the deferred commencement condition from one year to five years after the date of issue of the development consent.
The Council determined the modification application on 10 March 2016. The Council's assessment officer, in her report of 7 March 2016, recommended that the proposed physical modifications sought, to rely on the earlier plans dated 26 March 2016, not be supported. However, the Council's assessment officer recommended that modification be made to extend "the time frame to submit the required information with the DCC [Deferred Commencement Consent]" not by the five years sought by Mr Savellis but rather by two years.
The Council's assessment officer recommended modification of the deferred commencement condition as follows:
"B. That Development Application no.DA15/0227 for 'Demolition of Existing Dwelling and Construction of New Dual Occupancy' at Lot 102 DP259494, 13 Trumper Place, Menai, be modified as follows:
• Modification to part 1-deferred commencement condition
'To enable the submission of further information to clarify or resolve specific aspects of the proposed development this Development Consent is issued as a 'Deferred Commencement' Consent under the provisions of Section 80(3) of the Environmental Planning and Assessment Act as amended. The consent does not operate until the applicant satisfies the Council as to the following matters.
The required information must be submitted within 3 years of the date of issue of this Development Consent, ie not later than 19 June 2018.
(rest of the condition remains the same)'"
On 10 March 2016, the Council determined, by delegated authority of the Manager of the Council's Assessment Team, to modify the consent, purportedly pursuant to s 96(2) of the EPA Act, to extend the period within which the required information must be submitted to the Council from one year to three years of the date of issue of the development consent (i.e. by 19 June 2018). The terms of the modification were as recommended and have been quoted above.
Mr and Mrs Savellis did not, at that time, apply under s 95A(1) of the EPA Act to extend the period after which the development consent would lapse for another year. Under s 95(6) of the EPA Act, a development consent that is subject to a deferred commencement condition under s 80(3) lapses if the applicant fails to satisfy the consent authority as to the matter specified in the condition within five years from the grant of the consent or, if a shorter period is specified by the consent authority, within the period so specified. The Council did specify a shorter period of one year within which Mr and Mrs Savellis needed to satisfy the Council as to the matter specified in the deferred commencement condition. Hence, the development consent would lapse, by operation of s 95(6), after 19 June 2016 unless Mr and Mrs Savellis satisfied the deferred commencement condition before that date.
The mechanism to extend this lapsing period was to apply for and the Council to grant an extension under s 95A of the EPA Act. However, Mr and Mrs Savellis did not apply under s 95A of the EPA Act for an extension of the period after which the deferred commencement consent would lapse. The Council did not purport to exercise the power under s 95A(2) of the EPA Act to extend the lapsing period, firstly, because the Council stated it was exercising the power under s 96(2) of the EPA Act and, secondly, because the Council granted an extension of two years when an extension of one year only is available under s 95A of the EPA Act.
After purportedly modifying the development consent under s 96(2) of the EPA Act, the Council had second thoughts as to its power to have done so. The Council wrote to Mr Savellis on 31 October 2016 saying:
"I am writing to you as a follow up to recent conversations you have had with Simone Plummer, Manager Development Assessment and Certification.
I have reviewed the applications you have lodged for dual occupancy at 13 Trumper Place, including a deferred commencement consent issued to you as DA15/0227 and the s.96 application issued to you as MA15/0353. The modification application was to extend the deferred commencement period given to you in the original DA so that you could resolve the restriction noted on title of your land.
Since approving the modification application, Council has become aware that s.96 may not be an appropriate mechanism to extend the period allowed to satisfy deferred matters. Consequently, it is likely that DA15/0227 has lapsed.
Before taking further action toward removing the restriction on the title for 13 Trumper Place, it would be prudent for you to seek legal and planning advice as to whether you are acting on a robust approval."
Mr Savellis said in oral submissions at the hearing of the appeal that he had a conversation with the Council's Director of Planning, Mr Barber, in March 2017 in which Mr Savellis asked Mr Barber to make a decision whether the development consent had lapsed, and Mr Barber said he was unwilling to do this as it was a grey area and it was up to Mr Savellis to get legal advice.
Mr and Mrs Savellis still have not been able to satisfy the deferred commencement condition by securing the release, variation or modification of the restriction as to user so as to permit the erection and use of the dual occupancy development approved by the development consent.
[2]
The applicant seeks to modify the deferred commencement consent and extend the lapsing period
Faced with the prospect of the modified development consent lapsing after 19 June 2018, Mr Savellis made two applications to the Council. The first in time was an application made on 12 February 2018 under s 95A(1) of the EPA Act to extend the development consent for one year. The application attached a letter dated 20 January 2018 from Mr Savellis' planning consultant, Mr Daintry, which referred to legal advice explaining why the development consent had not lapsed.
The Council responded to the first application by letter dated 22 March 2018 from the Council's in house lawyer to Mr Savellis' planning consultant, Mr Daintry, saying:
"I refer to your letter to Council dated 20 January 2018. This matter is a complex matter with a complicated history and Council thanks you for the analysis provided in your correspondence.
However, I have provided advice to Council and I advise that Council has given serious consideration to the issues and to your response, including seeking external advice from a barrister in relation to this matter.
Council cannot agree with your conclusion that the consent has not lapsed and is available to be modified. It is Council's opinion that the development consent has lapsed and accordingly, there is no development consent which is available to be modified either pursuant to s4.54 (previously s95A) or pursuant to a further s4.55 (previously s96) modification application.
Council cannot see a mechanism for the approval of a dual occupancy on this site. Council has discussed this matter with your client and various of his representatives and explained this position. However if you remain unclear regarding Council's position please contact Simone Plummer…"
The second in time was an application made on 21 March 2018 for modification of the development consent, under the now numbered s 4.55(1A) (the former s 96(1A)) of the EPA Act, to remove the deferred commencement condition.
The Council responded by letter to Mr Savellis to the second application on 29 March 2018 saying:
"This letter is to advise that Council has reviewed your application and has cancelled the application as a lapsed consent cannot be modified. As advised by Council to your planning consultant Mr Daintry on 22 March 2018 DA15/0227 has lapsed.
A full refund of your fees is being processed and you will receive further correspondence regarding the refund…"
[3]
The applicant appeals against the Council's refusals
On 23 May 2018, Mr Savellis appealed against the Council's then refusal of both of these applications under the former s 95A(1) and the current s 4.55(1A) of the EPA Act respectively to extend the lapsing period and to modify the development consent to remove the deferred commencement condition.
Mr Savellis sought and the Court granted an expedited hearing of the appeal. The hearing has been held today, 18 June 2018, one day before the date after which the modified development consent would purportedly lapse (19 June 2018). Mr Savellis' goal in seeking the removal of the deferred commencement condition is to prevent the lapsing of the development consent. If the deferred commencement condition were to be removed, the development consent would become operative and would not lapse for a period of three years from the date from which the consent operates (which would be the date of the Court's decision to remove the deferred commencement condition).
The Council's response is that the development consent has already lapsed (after 19 June 2016) and there is no power to modify a consent that has lapsed. Hence, the Court cannot modify the development consent to remove the deferred commencement condition, as sought by Mr Savellis, and the appeal should be dismissed.
The Council also commenced proceedings in class 4 of the Court's jurisdiction seeking a declaration that the development consent lapsed on 19 June 2016 and that the Council's purported modification of the development consent on 10 March 2016 to extend the time to satisfy the deferred commencement condition from 19 June 2016 to 19 June 2018 was invalid and of no effect. The Council had sought for this class 4 application to be heard today as well. However, after reflection, the Council did not press for its class 4 application to be heard today on the basis that the Council could effectively defend the appeals by making its submissions that the consent has lapsed. Accordingly, Mr and Mrs Savellis' appeals only have been heard today.
In the appeal on the modification of the consent, the Council accepted that, if the development consent had not lapsed, the modification sought of the deletion of the deferred commencement condition would be appropriate. The currently applicable Sutherland Local Environmental Plan 2015, which came into force on 23 June 2015 after the grant of the development consent in this case, contains a provision, cl 1.9A, included pursuant to the former s 28(2) of the EPA Act, stating that specified regulatory instruments do not apply to development carried out in accordance with a consent granted under the EPA Act.
The restriction as to user, which applies to the land of Mr and Mrs Savellis, would be such a regulatory instrument. Hence, the restriction as to user would not apply to prevent the carrying out of the dual occupancy development in accordance with the development consent. The deferred commencement condition has therefore been rendered otiose and could be deleted as serving no useful or practical purpose.
However, the Council submitted that the deferred commencement condition cannot now be deleted because the development consent has lapsed. The Council submitted that the development consent lapsed on 19 June 2016, by operation of s 95(6) of the EPA Act, when the applicant failed to satisfy the Council as to the matter specified in the deferred commencement condition within the time period specified of one year of the date of issue of the development consent. Once that occurred, there no longer was a consent upon which Mr and Mrs Savellis could rely for the purpose of making an application pursuant to s 4.55(1A) for modification of the consent.
This is, therefore, the only issue in the appeal on the modification of the consent: did the development consent lapse on 19 June 2016?
In the appeal on the extension of the lapsing period, there is also only one issue, namely, whether the development consent lapsed after 19 June 2016 before Mr and Mrs Savellis made the application under s 95A(1) to extend the lapsing period. Section 95A(1) provides an applicant may apply to the consent authority for an extension of one year but must make the application before the expiry of the period after which the consent lapses. Mr and Mrs Savellis did not apply for an extension under s 95A(1) until 12 February 2018, well after 19 June 2016, which on the Council's case was the date after which the development consent lapsed.
[4]
The Council's argument that the consent has lapsed
The Council's argument as to why the development consent lapsed after 19 June 2016 is straightforward. The Council in granting the development consent imposed a deferred commencement condition under s 80(3) of the EPA Act. The Council, pursuant to cl 95(3) of the EPA Regulation, specified the period within which the applicant was required to satisfied the Council as to the matter specified in the deferred commencement condition, being one year of the date of issue of the consent (19 June 2016). This was a shorter period than the default statutory period of five years provided for in s 95(6) of the EPA Act.
Section 95(6) provides for the lapsing of a deferred commencement condition:
"Despite any other provision of this section, a development consent that is subject to a deferred commencement condition under section 80 (3) lapses if the applicant fails to satisfy the consent authority as to the matter specified in the condition within 5 years from the grant of the consent or, if a shorter period is specified by the consent authority, within the period so specified."
In this case, Mr and Mrs Savellis did not satisfy the Council as to the matter specified in the deferred commencement condition by the date specified (19 June 2016). Accordingly, s 95(6) operated to cause the development consent to lapse after 19 June 2016.
The Council submitted that this statutory consequence of lapsing was not prevented by Mr and Mrs Savellis' application for and the Council's grant of the modification of the development consent to change the period stated in the deferred commencement condition from one year to three years of the date of issue of the consent. The Council submitted that s 96 of the EPA Act cannot be used to change the time period specified in a deferred commencement condition within which an applicant must satisfy the consent authority as to the matter specified in the deferred commencement condition: see Kinder Investments Pty Limited v Sydney City Council (2005) 143 LGERA 237; [2005] NSWLEC 737 at [45]-[47] and Reid's Farm Pty Ltd v Murray Shire Council (2010) 182 LGERA 1; [2010] NSWLEC 127 at [61].
The Council's purported exercise of the power under s 96(2) of the EPA Act to extend the time from one year to three years was legally ineffective. Section 95(6) of the EPA Act continued to operate so as to cause the development consent to lapse upon the expiry of the period of one year from the date of issue of the consent (on 19 June 2016). The purported modification under s 96(2) was legally ineffective to prevent the statutory consequence of lapsing: Kinder Investments Pty Limited v Sydney City Council at [39]-[42] and Reid's Farm Pty Ltd v Murray Shire Council at [57]-[60].
The Council submitted that the only mechanism by which the period specified in the deferred commencement condition, within which the applicant must satisfy the consent authority as to the matter specified in the condition in order to prevent the development consent from lapsing, can be extended is by making an application under s 95A(1) of the EPA Act before the period expires. In this case, Mr and Mrs Savellis did not make an application under s 95A(1) and the Council did not exercise the power under s 95A(2) to extend the lapsing period before the lapsing period expired after 19 June 2016.
Hence, the Council submitted that the development consent expired after 19 June 2016.
The Council submitted that there was, therefore, no development consent upon which Mr and Mrs Savellis could rely for the purpose of making their application pursuant to s 4.55(1A) for modification of the consent by deletion of the deferred commencement condition or their application under s 95A(1) to extend the lapsing period: Hilltop Planners Pty Limited v Great Lakes Council (2003) 127 LGERA 333; [2003] NSWLEC 214 at [50] and see also the argument at [27].
[5]
The applicant's argument that the consent has not lapsed
In response to the Council's argument about the lapsing of the development consent, Mr Savellis relied on the planning and legal advice given in Mr Daintry's letter of 20 January 2018 that the consent had not lapsed. The letter referred to a note, note 5, to the original development consent, which stated:
"5. This consent will lapse unless the development is physically commenced within three (3) years from the Date of Operation of this consent (i.e. the date on which the Deferred Commencement condition is deemed to have been satisfied by Council), in accordance with Section 95 of the Environmental Planning and Assessment Act 1979 as amended."
The letter argued that the consent was not expressed to have lapsed on the non satisfaction of the deferred commencement condition (originally one year and, after modification, three years from the date of issue of the consent). The letter argued that the Council did not express "a shorter period" for the lapsing of the consent, as provided by s 95(6) of the EPA Act. Rather, the lapsing of the consent relates to its physical commencement (after it becomes operative).
The letter argued that the consent is different to the consent in Reid's Farm Pty Ltd v Murray Shire Council. In Reid's Farm v Murray Shire Council, the consent clearly specified that the consent would lapse if the Council was not satisfied within the period specified. However, the consent here does not do so. To the contrary, the consent is expressed to expire three years from its date of operation. For that reason, the consent has not lapsed.
The letter argued that nothing in s 80(3) of the EPA Act, relating to deferred commencement consents, or s 95A dealing with the extension of lapsing periods, affects this conclusion. This conclusion cannot cause the consent to lapse later than the period specified in s 95(6), namely five years from its grant.
The letter argued that the modification by the Council under s 96(2) of the EPA Act validly extended the period for compliance with the deferred commencement condition and the consent remains valid. This follows from the modification as issued by the Council, and the terms of s 95(6) of the EPA Act.
[6]
The consent has lapsed
I find that the development consent has lapsed on the expiry of the period of one year after the date of issue of the consent (i.e. after 19 June 2016). I agree with and adopt as my reasons the submissions made by the Council summarised above about the lapsing of the consent.
The argument advanced in the letter of Mr Daintry as to why the consent has not lapsed is erroneous. The EPA Act provides two different ways in which a development consent may lapse. One way concerns development consents that are operative. An operative consent is one that is not granted subject to a deferred commencement condition under s 80(3) of the EPA Act or one where, if the development consent is granted subject to a deferred commencement condition, the applicant has satisfied the consent authority as to the matters specified in the condition. Section 95 provides that an operative development consent lapses five years after the date from which it operates (s 95(1)) but the consent authority may reduce that period of five years (s 95(2)) but not to less than two years (s 95(3)).
A development consent operates from the date endorsed on the notice given to the applicant in accordance with s 81(1) of the determination of the development application or such other date specified in s 83 of the EPA Act, or, in the case of a deferred commencement consent, the date on which the applicant satisfies the consent authority as to the matter specified in the deferred commencement condition.
In this case, the Council may have sought, pursuant to s 95(2) of the EPA Act, by including the note 5 to the consent, to reduce the lapsing period of five years to three years after the date from which the consent operates. The Council noted that because the consent was subject to a deferred commencement condition, the consent would not operate until the applicant satisfied the Council as to the matter specified in the deferred commencement condition. The consent would operate from the date on which the Council was so satisfied. The lapsing period of three years, specified in note 5 to the consent, would commence from that date.
The second way in which a development consent can lapse concerns deferred commencement consents. These are consents subject to a deferred commencement condition under s 80(3). Section 95(6) fixes a different lapsing period for these consents. If an applicant does not satisfy the consent authority as to the matter specified in the deferred commencement condition, a deferred commencement consent will lapse within five years from the grant of the consent or, if a shorter period is specified by the consent authority, within the shorter period so specified. The shorter period to be specified by the consent authority is as to the time period within which the applicant must satisfy the consent authority as to the matter specified in the deferred commencement condition. This is a different period to the period of less than five years that a consent authority can specify under s 95(2) of the EPA Act.
In this case, the Council specified a period of one year from the date of issue of the development consent, within which the applicant was required to satisfy the Council as to the matter specified in the deferred commencement condition. This was the "shorter period" specified for the purposes of s 95(6) of the EPA Act.
Section 95(6) operated to cause the development consent to lapse within this shorter period of one year after the date of issue of the consent if the applicant did not satisfy the Council as to the matter specified in the deferred commencement condition within that period.
The argument in the letter that the development consent was validly modified, so as to extend the lapsing period for the purposes of s 95(6), is also erroneous. For the reasons given in Kinder Investments Pty Limited v Sydney City Council and Reid's Farm Pty Ltd v Murray Shire Council, the Council did not have power under s 96(2) to modify the development consent to extend the period of time within which the applicants had to satisfy the Council as to the matter specified in the deferred commencement condition and hence to extend the lapsing period for the purpose of s 95(6) of the EPA Act. Any purported modification of the development consent was legally ineffective to prevent the operation of s 95(6) causing the development consent to lapse on the expiry of the period of one year from the date of consent when the applicant had not satisfied the Council as to the matter specified in the deferred commencement condition.
For these reasons, I find that the development consent did lapse after 19 June 2016. There is, therefore, no development consent on which Mr and Mrs Savellis can rely to make their applications under s 95A(1) to extend the lapsing period specified in the consent or under s 4.55(1A) to modify the consent to delete the deferred commencement condition. The Court on these appeals has no power under s 95A(2) to grant the extension of the lapsing period or under s 4.55(1A) to modify the consent to delete the deferred commencement condition. The appeals must therefore be dismissed.
Because of the Council's conduct in 2016 in purporting to modify the consent to extend the lapsing period when it had no power to do so, the Council has offered to reimburse Mr and Mrs Savellis for their fees in filing the appeals. I will make such an order.
[7]
The orders of the Court
The Court orders:
1. The appeal is dismissed.
2. The respondent is to pay to the applicants the filing fees incurred by the applicants in commencing the appeal.
[8]
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Decision last updated: 28 June 2018