SIDNEY HARRISON PL v CITY OF TEA TREE GULLY & ANOR No. SCCIV-01-248 [2001] SASC 27

2 The first and second plaintiffs are related companies. The first plaintiff is a funeral director. It owns land at 63 Golden Grove Road, Ridgehaven. It conducts funeral services, interments and the business of an undertaker on this land. The second plaintiff owns land at 1 Golden Grove Road, Ridgehaven. It adjoins the land owned by the first plaintiff. The land is listed on the State Heritage Register by reason of the fact that Drumminor House is situated on the land. The land owned by the plaintiffs is situated in the area of the Council. On 5 October 2000 the Council granted the first plaintiff development consent to establish a cemetery on the land owned by the second plaintiff.

3 In late September and early October 2000, the plaintiffs learned that a telecommunications tower had been erected on land immediately to the north of the second plaintiff's land. The tower is quite close to the second plaintiff's land. The tower is erected on land owned by the Council. It had been erected pursuant to the grant of development consent by the Council. The steps leading to the grant of development consent are as follows.

4 On 15 May 2000 the second defendant, Network Design and Construction Ltd ("NDC") applied to the Council for development consent to erect what it called a telecommunications facility on land on which the Modbury Soccer Ground is located. The Modbury Soccer Ground is situated on land owned by the Council which adjoins the northern boundary of the plaintiffs' land. On 24 May 2000 the Council granted provisional development plan consent to NDC for the construction of the telecommunications facility.

5 On 7 July 2000 NDC applied for development consent for the telecommunications facility to be relocated to a point immediately adjacent to the land owned by the second plaintiff. On 24 July 2000 the Council granted provisional development plan consent for the relocation of the telecommunications facility to that point. The tower was erected on 1 October 2000. On 3 October 2000 the Council granted development approval for the construction of the telecommunications facility to NDC.

6 The telecommunications facility comprises a telecommunications station with associated microwave antennae and a base station. The tower is what is commonly called a mobile telephone tower. It is some 30 metres high. It is erected within one metre of the land owned by the second plaintiff. Neither of the plaintiffs were informed by the Council or by any other person of the proposed construction of the facility. The plaintiffs say that, had they been given notice, they would have objected to the construction of this telecommunications facility at its present location.

7 When dealing with these two applications by NDC for development consent, the Council classified the proposed development as a Category 1 development. The effect of that classification is that it was unnecessary for the Council to give any kind of public notice of the proposed development: s 38 of the Development Act 1993.

8 On 6 October 2000 the solicitors for the plaintiffs wrote to the Council giving notice, among other things, that they intended to challenge the decision granting development consent on a number of grounds. Those grounds included the ground that the Council had wrongly classified the proposed development as Category 1 when it should have classified it as Category 3. If the proposal is classified as a Category 3 development, the plaintiffs have the right to make representations to the Council and, if the Council approves the development, they have the right to appeal from that decision to the Environment Resources and Development Court: see s 38 of the Development Act. The statutory régime is described in Polites v City of Holdfast Bay (No 2) (1998) 72 SASR 475 at 478 - 479.

9 On 28 December 2000 NDC lodged a further application for development consent in respect of the telecommunication facility for which development consent had been granted on 21 July 2000 and 3 October 2000. For convenience, I will call this the second application. More strictly, it is the third application relating to this facility and the second for development at its present site. The second application was accompanied by a letter dated 28 December 2000 to the Council written by the planning consultants acting on behalf of NDC. The letter is in these terms:

"Please find herewith a without prejudice application, lodged at the request of the Council for the erection of a telecommunications facility (existing) at the Modbury Sports Reserve, Golden Grove Road, Ridgehaven.

I attach for your assistance the relevant proposal plans and application fee for the development.

The subject land is located within a Special Uses zone as depicted on Map Ttg/24 of the Tea Tree Gully Development Plan and is a recreation area in the ownership of the Council.

The proposed facility has been subject of a number of applications, the original development approval as granted on 5 June 2000 providing for the erection of a 25 metre tower, situated to the immediate south east of the main building adjacent to the existing grassed soccer ground.

At the request of Council, the facility was moved to the south east, further away from Milne Road to a site immediately north west of the existing bowling greens (D.A 75044/2000), the application for which was approved by Council on 3 October 2000.

The facility has subsequently been constructed in accord with the consent issued by the Council.

At a further request from the Council this application has been submitted to address alleged shortcomings in the manner in which the application was processed by the Council.

I am instructed that this application is to be made without prejudice to the existing consent upon which the facility has been constructed.

Please do not hesitate to contact me if you have any questions."

It is unnecessary to comment on the utility of a so-called "without prejudice application". More importantly, as the letter twice stated, the application was lodged at the request of the Council. The Council classified the development, the subject of the second application, as a Category 3 development. This is entirely contrary to its earlier classification of the application as Category 1. Notice of the second application was given to the first plaintiff by letter dated 22 January 2001. The Council also gave public notice of the application by advertisement in "The Advertiser" newspaper published on 23 January 2001.

10 The Council recognises that its earlier decision granting development consent means that it has a conflict of interest when considering and determining the second application. By letter to the Minister for Urban Planning dated 19 January 2001, Council referred to that fact and asked the Minister to request the Development Assessment Commission to act as the relevant planning authority pursuant to s 34(1)(b)(iii) of the Development Act. Section 34(1)(b)(iii) and s 34(1)(b)(vi)(A) provide:

"(iii) the Minister, acting at the request of the relevant council, declares, by notice in writing served personally or by post on the proponent, that the Minister desires the Development Assessment Commission to act as the relevant authority in relation to the proposed development; or

(vi) (A) in the Minister's opinion the relevant council has demonstrated a potential conflict of interest in the assessment of the development because of a publicly stated position on that particular development;"

The Council's letter to the Minister of 19 January 2001 reads:

"Pursuant to Section 34(1)(b)(iii) of the Development Act, 1993 please find enclosed a copy of the application form and accompanying plans and information for the abovementioned development.

A previous land use application 070/75000044/00 and a subsequent land division (lease) application, 070/D030/00 were both submitted to you requesting that the Development Assessment Commission be declared to act as the relevant authority. In both instances that request was declined.

Council considered and processed the land use application as a Category 1 development, and duly issued its consent. The land division (lease) has as yet not been finalised.

An abutting land owner has expressed opposition to the proposal and has asserted that the application was incorrectly classified by Council in that it ought to have been processed as a Category 3 development. That same adjoining land owner has threatened to instigate judicial review proceedings.

Whilst Council is still of the firm view that the tower is appropriately located and believes that the Category 1 classification is defensible, the current application has been lodged, on a without prejudice basis. To expedite finalisation of the proposal. Council has agreed to undergo the Category 3 public notification process thereby providing an opportunity for the aggrieved adjoining owner to appeal the development on solely Planning merits.

As the Council has approved the previous application and the applicant has erected the tower, albeit without the lease documentation being finalised, Council clearly has a stated position in this matter. Council therefore requests that the Development Assessment Commission be declared to act as the relevant authority in relation to this application.

Please do not hesitate to contact me on 8397 7251 should additional information or clarification be required."

The Minister has not yet replied to the Council's request. As the letter suggests, in addition to the fact that the Council has already granted development consent, the Council has other interests in the second application. The telecommunications facility is erected on Council land and NDC seeks to enter into a lease with the Council for the right to use part of the Council's land. The proposed rent is $10,000 per annum.

11 On 19 January 2001 the plaintiffs commenced proceedings seeking a number of orders in the nature of a declaration. On 2 February 2001 the plaintiffs applied for an injunction restraining the Council from hearing and determining the second application. On 5 February 2001 a Master of this Court granted an interlocutory injunction restraining the Council from hearing any representations concerning the second application and from determining it. On 8 February 2001 I ordered that there be an early trial of certain issues in the action. The question now to be determined is whether the Council is disqualified from hearing representations and deciding the application.

12 The fact that the Council has already granted development consent in respect of the very development which is the subject of the second application means that the Council has a publicly stated position in respect of this development. That position was publicly declared when the Council granted development consent. Furthermore, the Council itself recognises that it has a conflict of interest. It has plainly expressed that in its letter to the Minister of 19 January 2001. Indeed, as is implicit in that letter, the Council very properly realises that it has a manifest conflict of interest because, to use the Council's words, it "clearly has a stated position in this matter". Those facts justify the Minister, if not require the Minister, to exercise her powers under s 34 of the Development Act to declare the Development Assessment Commission to be the relevant planning authority.

13 However, the facts of this matter require that the question whether the Development Assessment Commission should determine the application should not depend on the decision of the Minister. For the reasons which follow, the Council's stated views concerning this telecommunications facility and its other interests in the outcome are such that the Council can no longer be the planning authority which should consider and determine the second application.

14 It is well settled that, subject only to the clear manifestation of a contrary statutory intention, there is a common law duty to act fairly, in the sense of according procedural fairness, when making administrative decisions which affect rights, interests and legitimate expectations: Kioa v West [1985] HCA 81; (1985) 159 CLR 550 at 584; Annetts v McCann [1990] HCA 57; (1990) 170 CLR 596 at 598; Upham v The Grand Hotel Pty Ltd [1999] SASC 414; (1999) 74 SASR 557 at 566 - 567. In my view, it is implicit in s 34 and in s 34(1)(b)(vi)(A) that the rules of procedural fairness apply in relation to the hearing and determination of development applications at least in the case of Category 3 developments.

15 The rules of procedural fairness require that a decision-maker should be able to decide the issues free from any bias or pre-judgment. The test for determining whether a person is disqualified by reason of the appearance of bias (which in the present case takes the form of pre-judgment) is whether a fair-minded, lay observer might reasonably apprehend that the decision-maker might not bring an impartial and unprejudiced mind to the resolution of the question which must be decided: Johnson v Johnson [2000] HCA 48 at para 11; Ebner v Official Trustee [2000] HCA 63 at para 33.

16 The Council itself properly recognises that, by reason of the fact that the Council has already granted development consent to this very facility, the fair-minded bystander would reasonably apprehend that the Council would not bring an impartial and unprejudiced mind to the question whether development consent should be granted to the second application. The Council has said as much in its letter of 19 January to the Minister. Thus, the rules of procedural fairness require that the Council be disqualified from considering and determining a second application, a fact which the Council itself recognises.

17 But the matter does not end there. As the Council's letter to the Minister discloses, it has a real financial interest in maintaining the validity of this development consent so that it may recover a reasonably substantial rent. That financial interest gives rise to a perception of bias in that the fair-minded bystander might reasonably apprehend that the Council might not bring an impartial and unprejudiced mind to the question whether development consent should issue. This is a further reason to disqualify the Council. I have not so far relied on the fact that, according to NDC, the Council asked it to lodge the second application in order to address shortcomings in the manner in which the earlier application was processed. The Council does not deny NDC's assertion. The Council's request is further confirmation of the interest that the Council has in the granting of development consent for this application. For all of these reasons, the Council must be disqualified from deciding whether development consent should issue.

18 The doctrine of necessity does not require the Council to determine the second application. The Development Act, and in particular s 34, prescribe that there is another planning authority which could hear and determine this application. It is the Development Assessment Commission. As the Council is disqualified from determining the second application, the application should now be considered and determined by the Development Assessment Commission.

19 For all of these reasons, there will be orders as follows:

1. Declaring that the Council is disqualified from hearing representations in relation to and determining Development No. 070/76054/00.

2. Declaring that the Development Assessment Commission should consider and determine the said application.

3. That the Registrar forthwith deliver these reasons to the Minister for Urban Planning and the Development Assessment Commission.