Sheer Property Group Pty Ltd v Randwick City Council

Winten Property Group Ltd v North Sydney Council (2001) 130 LGERA 79 CASES CITED: Wehbe v Pittwater Council (2007) 156 LGERA 446 Black v Randwick City Council [2010] NSWLEC 1164

APPLICANT Mr I Hemmings, barrister Instructed by Mr G Christmas LEGAL REPRESENTATIVES: Apex Planning and Environment Law RESPONDENT Mr P Rigg, solicitor Norton Rose

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

10703 of 2010 Sheer Property Group Pty Ltd v Randwick City Council

JUDGMENT 1 Commissioner: On 25 February 2010 the applicant applied to the respondent Council for development consent to demolish an existing two story residential flat building at 254 Clovelly Road Coogee (the site), construct two attached dwellings on the site, and subdivide the site into two lots. 2 On 25 August 2010 the Council granted development consent to DA 123/2010, subject to conditions which included condition 2: 2. The proposed subdivision of the subject site is not approved and must be deleted from the plans and documentation submitted for the construction certificate. 3 The applicant appeals under s97 of the Environmental Planning and Assessment Act 1979 (the Act) against the imposition of condition 2. The issue between the parties is whether an objection under State Environmental Planning Policy No 1 - Development Standards (SEPP 1) to compliance with the minimum allotment size should be upheld so that the subdivision can be approved. The parties have agreed on conditions that should be imposed if the objection is upheld and condition 2 deleted. The site and locality 4 The site has an area of 508.5 sqm, with 14.020m frontage (with pedestrian access) to Clovelly Road. The site also has a frontage with vehicle access to Dans Avenue. Each of the two approved dwellings has four bedrooms and a two car garage. If approval is granted to subdivide the site, each allotment would have a frontage of 7.010m, and a site area of 254.25 sqm. 5 The section of Clovelly Road between Arden Street and Dans Avenue in which the site is located contains a number of semi-detached single dwelling houses on lots varying between 230 sqm to 260 sqm. The adjoining property to the west has a two storey residential flat building. The adjoining property to the east is a pair of part one and part two storey semi detached dwellings. Planning controls 6 The site is zoned 2A (Residential A Zone) under the Randwick Local Environmental Plan 1998 (Consolidation) (the LEP) which came into force on 15 January 2010. 7 The aims of the LEP are: 2 Aims

The aims of this plan are: (a) to consolidate and review existing planning controls in the City of Randwick, and (b) to reduce the number of zones into which land is divided, and (c) to create a broad framework of planning controls within which the Council may prepare development control plans to formulate and adopt more detailed policies and guidelines relating to matters of significance for local environmental planning, and (d) to ensure that development is carried out in such a way as to allow the economic and efficient provision of public services and amenities, and (e) to ensure the conservation of the environmental heritage and aesthetic character of the City, and (f) to facilitate and encourage community consultation and participation in the planning process, and (g) to promote, protect and enhance the environmental qualities of the City, and (h) to recognise the importance of ecological sustainability in the planning and development processes, and (i) to recognise the responsibilities of accountability in the planning processes, and (j) to enhance individual and community economic well-being and welfare and safeguard the welfare of future generations, and (k) to encourage consideration of social consequences when decisions are made in the implementation of this plan, and (l) to encourage the provision of housing mix and tenure choice, including affordable housing, in the City, and (m) to encourage the retention of affordable housing in the City in a variety of types and tenures.

Purpose: To establish and specify the aims of this plan. 8 Clause 9 provides: 9 Objectives

The Council may grant consent to the carrying out of development on land to which this plan applies only after it has considered the extent to which the proposed development is consistent with the general aims of this plan and the specific objectives of the zone within which the development is proposed.

Purpose: To require the general aims of this plan and the specific objectives of each zone to be taken into account in the assessment and determination of development applications . 9 Clause 10 provides the objectives of the 2A zone: 10 Zone No 2A (Residential A Zone)

(1) The objectives of Zone No 2A are: (a) to provide a low density residential environment, and (b) to maintain the desirable attributes of established residential areas, and (c) to protect the amenity of existing residents, and (d) to allow for a range of community uses to be provided to serve the needs of residents, workers and visitors, and (e) to encourage housing affordability, and (f) to allow people to carry out a range of activities from their homes, where such activities are not likely to adversely affect the environment of the locality. (2) Development for the purpose of the following does not require development consent: Bushfire hazard reduction; Public utility undertakings; Recreation

(3) Development for the purpose of the following requires development consent: Attached dual occupancy; Bed and breakfast accommodation; Boarding houses; Child care centres; Communication facilities; Community facilities; Dwelling houses; Earthworks; Educational establishments; Health consulting rooms; Home activities; Outdoor advertising; Places of worship; Public transport; Recreation facilities; Roads

(4) Any development not included in subclause (2) or (3) is prohibited. 10 Under cl21, subdivision of land to which the LEP applies is permissible with development consent. 11 Part 2B of the LEP is headed Principal Development Standards, and cl20B provides minimum allotment sizes: 20B Minimum allotment sizes

(1) The minimum allotment size for allotments resulting from the subdivision of land, other than for the purpose of public utility undertakings or roads, within Zone No 2A is 400 square metres and each allotment must have a frontage of at least 12 metres. (2) The minimum allotment size for allotments resulting from the subdivision of land, other than for the purpose of public utility undertakings or roads, within Zone No 2B or 2C is 325 square metres and each allotment must have a frontage of at least 9 metres. This requirement does not apply to development for the purposes of multi-unit housing. (3) The minimum allotment size for the erection of a dwelling house within Zone No 2A is 400 square metres and the allotment must have a frontage of at least 12 metres. (4) The minimum allotment size for an attached dual occupancy within Zone No 2A is 450 square metres and the allotment must have a frontage of at least 15 metres. (5) This clause does not prohibit the erection of a dwelling house within Zone No 2A, 2B or 2C on an allotment of land that existed as a separate allotment on the appointed day.

Purpose: To establish minimum requirements for the subdivision of land within residential zones in order to protect and improve local amenity.

12 Clause 2A of the LEP provides: 2A Notes

Notes in this plan (other than those prefaced with "Purpose:") do not form part of this plan. 13 The definitions in cl49 of the LEP include "attached dual occupancy" and "dwelling house": attached dual occupancy means a building containing two (but not more than two) dwellings. … dwelling house means a building containing one (but not more than one) dwelling.

Evidence 14 The hearing commenced on site with a view of the site and the surrounding area, including Dans Avenue. There was one written objection to the application from the Secretary of Strata Plan 39005 (250-252 Clovelly Road). 15 Expert planning evidence was given by Mr D O'Toole on behalf of the applicant and Mr S Harding on behalf of the Council.

Consideration 16 In its assessment of the development application DA 123/2010 the Council upheld objections under SEPP 1 to the application of development standards relating to floor space ratio and external wall height of the proposed dwellings, and frontage width. The Director City Planning Report commented on the built form of the proposed development: The proposed development has an FSR of 0.65:1, and exceeds the LEP standard by 0.15:1. The proposed external wall height amounts to 7.3m and marginally exceeds the development standard by 300mm. The frontage width of the site is 14m and falls short of the LEP standard of 15mm for attached dual occupancy development. Notwithstanding, the proposed design is sympathetic to the character of the Clovelly Road and Dans Avenue streetscape. The built form, proportions, massing and landscaped area provision are considered to be compatible with the lower density character of the locality. The development scheme will not result in a significant impact on the amenity of the surrounding properties in terms of visual bulk and scale, solar access and privacy. The SEPP 1 objections lodged with respect to the non-compliance with the aforementioned development standards are considered to be well founded. 17 The Council did not consider that the SEPP 1 objection to compliance with the minimum allotment size was well founded, and refused consent to the subdivision of the site. In these proceedings, the Council contends that condition 2 is a necessary part of the approval of the application and that approval of the development as an "attached dual occupancy" was premised on the subdivision of the development being prohibited in the 2A zone. The Council's review of minimum allotment sizes for dwellings as part of its review of the LEP led to a considered decision regarding the appropriateness of land sizes to accommodate low density dwellings that provide a minimum level of amenity to future residents, which includes such matters as access to reasonable private open space, solar access to living rooms and private open space, and setbacks and curtilage consistent with the low density zone. The approval of an allotment of land that does not meet the minimum allotment size will facilitate other similar subdivisions in the locality, and the precedent would undermine the objectives of providing diversity in housing choice. The Council contends that a variation to the development standard would reduce levels of amenity and that amenity would be enhanced by adherence to the development standard. 18 The applicant submits that the proposed subdivision is consistent with other allotment sizes in the locality and the proposed allotments are of appropriate dimensions to accommodate a dwelling house of a size, bulk and scale consistent with the character of residential development in the locality. The proposed dwellings have been approved by the Council. The subdivision would replace an existing use with a development which is wholly consistent with the relevant objectives of the 2A zone. In applying the definitions provisions of the LEP, the applicant submits that the approved "dual occupancy" would continue to be a "dual occupancy" after subdivision. Subdivision is permissible by virtue of cl21 of the LEP and the general controls do not specify any minimum allotment size for the subdivision of a dual occupancy. There is no equivalent provision to cl30(3) of the LEP before its consolidation, which specified 900 sqm as the minimum size for an allotment that could be subdivided to create separate allotments for dwellings comprising an attached dual occupancy in the 2A zone. There is no prohibition on subdivision of an attached dual occupancy, however cl20B(4) provides the minimum lot size. The applicant submits that the purpose of the development standard is that stated as "Purpose" at the end of cl20B, and it is not appropriate to identify the objective of the development standard by reference to any of the background documents and reports.

The SEPP 1 Objection 19 The revised SEPP 1 objection, which appears in Mr O'Toole's Position Paper (exhibit A), is based on two grounds. The first is that the underlying objective of the purposes of the development standard in cl20B(1) is not relevant in this case: It is clear that minimum allotment sizes for the residential zones have been determined in order to establish a requirement that future development on the created allotments will result in a built form which will protect and improve local amenity. In this case, the development of the subject land for two dwellings has already been determined by the Council to be satisfactory when it concluded that the impacts of the development will protect and improve local amenity. In my opinion, the subdivision of the approved development does not create the need for any further consideration of the requirement to preserve and protect local amenity. 20 The second basis is that compliance with the development standard is unreasonable or unnecessary as the development satisfies the underlying purpose of the clause because local amenity is protected and improved by the proposal. This argument is based on consideration of an area approximately between 240 to 270 Clovelly Road on its southern side, and 269 to 301 Clovelly Road on the northern side, which in Mr O'Toole's opinion provides the core visual catchment area of the site. The objection states: The image demonstrates that the majority of lots within the relevant area surrounding the site … have lot widths of approximately 7m and lot areas in the region of 230m2 to 280m2. There are some larger lots that contain residential flat buildings…, however as dwelling houses are the predominant form of development in the area and given the zoning of the land, the dwelling houses are the appropriate reference to be used to gauge the acceptability of the proposed lot width and areas for the purposes of considering - relevantly - the need to protect and improve local amenity. It should be noted that only one lot shown in the photograph above complied with the minimum lot area (#244). Consequently, the area and width of the proposed lots is entirely consistent with the prevailing subdivision pattern for this type of development. Importantly, that width and size permits the erection of housing - the otherwise approved dual occupancy - that is entirely consistent with the Councils desired future character for the area. As a result, the reduced area and width nonetheless improves and protects local amenity. The proposal will benefit local amenity by providing dwellings which are of a type which is sought to be achieved by the zoning of the land. Furthermore the proposed subdivision, which will provide consistency in lot sizes and dimensions when compared to neighbouring lots containing single dwellings, will consolidate the current consistency in the built form of those lots. Furthermore, given that the built form has been approved by Council it must follow that the built form will improve local amenity by providing contemporary dwellings that replace an aged multi unit development that does not provide good levels of amenity. For these reasons it is considered that compliance with the standard is unreasonable or unnecessary in this instance and the proposal satisfies the purpose and objective of the development standard (ie to protect and enhance local amenity) despite not complying with the numerical requirements.

Consideration of the SEPP 1 objection 21 The approach to be adopted to consideration of the SEPP 1 objection is set out by Lloyd J in Winten Property Group Ltd v North Sydney Council (2001) 130 LGERA 79 at [26]: 26. In applying [ Hooker Corporation Pty Limited v Hornsby Shire Council (NSWLEC, 2 June 1986, unreported], it seems to me that SEPP 1 requires answers to a number of questions (not necessarily in the following order). First, is the planning control in question a development standard? Second, what is the underlying object or purpose of the standard? Third, is compliance with the development standard consistent with the aims of the Policy, and in particular does compliance with the development standard tend to hinder the attainment of the objects specified in section 5(a)(i) and (ii) of the EP&A Act? Fourth, is compliance with the development standard unreasonable or unnecessary in the circumstances of the case? Fifth, is the objection is well founded? In relation to the fourth question, it seems to me that one must also look to see whether a development which complies with the development standard is unreasonable or unnecessary, as noted by Cripps J in the Hooker Corporation case. 22 In Wehbe v Pittwater Council (2007) 156 LGERA 446 Preston CJ summarised a variety of ways in which a SEPP 1 objection might be well founded and be consistent with the aims set out in cl3 of SEPP 1. The grounds argued in this matter fall within the approaches outlined at paragraphs [42] and [45] of Wehbe. That case also concerned a SEPP 1 objection to compliance with a minimum allotment size, where the objective was stated in the applicable planning instrument to be "to create more varied allotment sizes, improve residential amenity and enhance the environment". 23 Upholding the SEPP 1 objection to compliance with cl20B(1) is a precondition to approval of that part of the development application that sought approval for subdivision of the site into two lots: Wehbe at [36]. Upholding the objection requires that I be satisfied that it is well founded and would be consistent with the aims in cl3 of SEPP 1: cl7 SEPP 1. Those aims are to provide flexibility where strict compliance would be unreasonable or unnecessary or tend to hinder the attainment of the objects specified in s5(a)(i) and (ii) of the Act.

24 Clause 21 of the LEP permits subdivision, with development consent. Clause 20B sets out the minimum allotment sizes. The provisions relevant to subdivision are those in cl20B(1) and (2). Clause 20B(1) applies to the 2A Zone, and thus to the site, and specifies a minimum allotment size for allotments resulting from subdivision of 400 sq m, and a frontage of at least 12 m. There is no equivalent provision to cl30(3) in the former LEP, which read: 30 Minimum allotment sizes … (3) The minimum size for an allotment that may be subdivided (whether or not by a strata plan) to create separate allotments for the dwelling comprising an attached dual occupancy within Zone 2A is 900 square metres. 25 In my view the omission of a clause in similar terms from the consolidated LEP is not significant, reading subclauses 20B(1) and (4) in the context of the controls provided in cl20B as a whole. Clause 20B(4) applies to determine when an attached dual occupancy development can be approved. Clause 20B(1) applies when the question is whether an allotment in the 2A zone (which may have a dwelling house or an attached dual occupancy, or an approval for either) can be subdivided. 26 In identifying what is the underlying object or purpose of the development standard imposed by cl20B(1), the starting point is the text of the clause. The applicant submits that the statement of "Purpose" at the end of cl20B is the underlying object or purpose of the development standard. The Council submits that this is to be ascertained by reference to those words, and by reference to the objectives of the zone and the aims of the LEP in order to understand what is meant by "local amenity". 27 The words appearing at the end of cl20B form part of the LEP: cl2A. As a statement of purpose, those words must be construed. I agree with the Council that in construing the phrase "protect and improve local amenity" it is appropriate to have regard to how the objectives of the 2A zone and the aims of the LEP address the desired local amenity, in particular the objectives in cl10(1)(b) and (c), and the aim in cl2(l) of the LEP. 28 Clause 20B(1) applies to all land in the 2A zone. In my view the area adopted by Mr O'Toole for consideration is too confined, and it is appropriate when considering "local amenity" to consider the site in the broader context of land in the 2A zone generally. I agree with Mr Harding that the relevant area for consideration of "local amenity" in this case is the area of 2A zoned land surrounding the site up to approximately 200-250m from the site, bounded by land zoned 2B to the east of the site (on the other side of Arden Street), and to the west at the intersection of Clovelly Road and Fern Street where there is a small area of land zoned 3B Local Business, and other land zoned 2B. This broader area of 2A zoned land contains a more diverse range of allotment sizes than the area identified by Mr O'Toole. The Director City Planning Report assessing the development application before the Council noted (at p9) that "the majority of allotments in the urban blocks within reasonable walking distance of the site have a larger land area and frontage than the proposal", and that less than half of the 243 allotments zoned 2A in the area bounded by Arden Street, Greville Street, Fern Street and Division Street had a land area of less than 260 sqm and/or a frontage width of less than 8m. 29 The provisions for minimum allotment size in cl20B of the LEP are the outcome of reviews of the previous planning instruments, which reduced the minimum allotment size for the 2A zone from 450sqm to 400 sqm. A Report by the Director City Planning (No 42 of 2005) (exhibit 4) stated: Investigation was carried out on the capability of the ensuing 450, 400 and 350sqm allotments (from 900, 800 and 700 respectively) for accommodating a single dwelling of appropriate modern standard (see Figure J in the Issues Paper). This shows that as the land size decreases it becomes harder to achieve two dwellings on 350sqm allotments with good design outcomes (for example, providing for the parking in the design, & the percentage of hard paved surfaces increase). The 400sqm allotment achieves two dwellings that are more acceptable. This scale of subdivision would be on average 10% smaller than the average subdivision patterns, thus generally not likely to adversely affect these patterns. Assessment indicates that the 400sqm allotments can accommodate a single dwelling closer to modern proportions whilst meeting the general requirements of good design, including streetscape impact and sufficient parking provision, whilst providing a slightly higher opportunity for subdivision in the low density residential areas. A reduction to 800sqm is also consistent with the original recommendations in the draft LEP 1998 report. Altering the minimum subdivision allotment size requires amendment to the Randwick LEP 1998. 30 The Report noted (at p11) that under the then current provisions approximately 7,000 properties were able to develop attached dual occupancies, however the restriction on strata subdivision had limited demand for this form of housing with 114 applications being considered in the previous five years. The Report continued: The subdivision (including strata subdivision) of attached dual occupancies is not permitted under LEP. Any variation that permits strata subdivision of attached dual occupancy is likely to increase the number of attached dual occupancy development applications substantially, that is subdivision would encourage a greater proportion of these 4,500 properties to be developed (almost 30% of 2A properties), as each dwelling can be sold separately in addition to renting or use by an extended family. The focus of this review is to provide reasonable opportunities for this housing type, where a high standard of design can be met and to continue the current focus on increasing density in areas that are most accessible to services and transport. 31 The outcome of the review supporting a 400 sqm minimum allotment for accommodating a single dwelling which can meet general requirements of good design while still providing some opportunity for subdivision in the lower density residential areas is reflected in the development standard imposed by cl20B(1).

32 The objective of cl20B is "to protect and improve local amenity". That aim is to be achieved by having allotments of the size specified for the relevant zones. The proposed allotment size for each of the two proposed allotments, at 254.25 sqm, is a substantial departure from the development standard of 400sqm, and one which, when considered in the broader context identified in [28] above, would not be consistent with the prevailing pattern of subdivision in the locality. 33 The SEPP 1 objection relies on the approval by the Council of the built form of the proposed dwellings, first, to establish that there is no need for further consideration of the requirement to preserve and protect local amenity, and secondly, on the basis that the replacement of the existing non-conforming building with contemporary dwellings will improve local amenity. However, subdivision of the site into two allotments raises different issues to consideration of the built form of the two proposed dwellings. The experts agreed that an attached dual occupancy development under one ownership would be more likely to be rented or occupied by an extended family. I agree with the Council that that would be consistent with the aims of the LEP which include encouraging the provision of housing mix and tenure choice. I am not persuaded that allotment size, and consequent potential differences in tenure for an attached dual occupancy, is not relevant to assessment of whether this proposal protects and improves local amenity. While the Council was satisfied that the replacement of the existing building with the approved attached dwellings would be more compatible with the lower density character of the locality, I am not persuaded that approval of the built form alone is sufficient to address the objective of protecting and improving local amenity such that the objective of the development standard is achieved notwithstanding non-compliance with the minimum allotment size. 34 Upholding the SEPP 1 objection for this site would provide little justification for not upholding SEPP 1 objections to similarly sized land in the 2A zone, which would be contrary to the planning policy developed during the course of the review of the LEP, and create an adverse planning precedent: see Wehbe at [79]. While acknowledging that there are grounds for distinguishing the decision of Hussey C in Black v Randwick City Council [2010] NSWLEC 1164, including the fact that it concerned the application of the LEP before the 2010 consolidation, I agree with his comments at [39] that there has been considerable investigation and strategic planning to amend the controls to reduce the subdivision lot sizes in order to achieve a desired level of local amenity. 35 I am not satisfied that the objection is well founded. I am not persuaded that compliance with the minimum allotment size in the circumstances of this case is unreasonable or unnecessary, and, far from hindering the attainment of the objects in s5(a)(i) and (ii) of the Act, I am satisfied that compliance with the minimum allotment size in the circumstances would be consistent with a strategic approach to planning and development and thus promote the orderly and economic use and development of land. Conclusion 36 I am not satisfied that the SEPP 1 objection should be upheld, and as a consequence that part of development application DA 123/2010 that sought consent for the subdivision of the site into two allotments cannot be approved. Condition 2 reflects the barrier to such a subdivision imposed by cl20B(1) of the LEP, and should remain. The development consent granted by the Council approved the demolition of the existing building and the erection of two attached dwellings on the site. There was no issue in these proceedings as to the appropriateness of the granting of consent to that development. Accordingly, the appropriate course is to confirm the development consent in the form granted by the Council and subject to the conditions imposed by the Council. 37 The orders of the Court are: 1. The appeal is dismissed. 2. Development application DA 123/2010 for the demolition of an existing building and construction of two new dwellings at 254 Clovelly Road Coogee is approved subject to the conditions in Annexure A. 3. The exhibits are returned except for exhibits 1, B, D, E and F. Linda Pearson Commissioner of the Court

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