Sin-Aus-Bel Pty Ltd and Western Australian Planning Commission [2006] WASAT 266 | Case summary

Sin-Aus-Bel Pty Ltd and Western Australian Planning Commission [2006] WASAT 266 | Case summary | Zoe

[25]

7 A development application for the redevelopment of the site was submitted to the City of Belmont on 13 March 2003, and was considered by Council on 26 May 2003. After advertising the proposal, the City's planning and development committee recommended, on 15 September 2003, that an independent town planning consultant be engaged to prepare a development plan for the site to guide the assessment of the proposed development. The application was also referred by a community member to the Heritage Council for assessment as to whether the Ascot Inn should be included on the State register. The process of heritage assessment, including reconsideration, was ultimately completed in December 2003 when the Heritage Council determined that the Ascot Inn does not have sufficient cultural heritage significance for inclusion on the State register.

8 During the course of the City's consideration of the proposal, amended plans were submitted by the proposed purchasers, and ultimately, on 5 July 2005, the Council of the City of Belmont recommended refusal of the development application. The proposal had also been the subject of a recommendation for refusal by the Swan River Trust in May 2004, and the revised proposal had been considered by the Swan River Trust in June 2005 but deferred pending detail and site investigation in relation to acid sulphate soils.

9 In light of the City of Belmont and Swan River Trust's recommendations refusing the development application, the trustees of the Ascot Inn Syndicate notified the vendor (being the applicant in these proceedings) that the condition of the contract requiring planning approval was waived by the purchaser. According to one of the trustee's of the syndicate, Mr Leigh Turner, there is now no certainty as to the final form of development intended for the development lot. The syndicate still intends, however, to implement an approval to create the reserve lot and the development lot.

10 Although these proceedings are brought in the name of the present proprietor of the subject land, it is the proposed purchaser that has pursued the application. I was advised at the outset of the hearing that the vendor and the purchaser are presently in dispute over the contract of sale, but the solicitors engaged by the Ascot Inn syndicate continue to be authorised to pursue the action in the name of the applicant.

[27]

11 Mr Timothy Hillyard is the manager of the Land Asset Management Branch (branch) of the Department for Planning and Infrastructure. The branch performs the function of acquiring, managing and disposing of land reserved under a regional planning scheme. In late July 2003, Mr Hillyard received a telephone call from Mr Don Eftos, a valuer who had been engaged by the Ascot Inn Syndicate, to undertake a valuation of the reserve portion of the subject land earlier in 2003. Mr Eftos enquired whether the Western Australian Planning Commission (WAPC) might be interested in purchasing the portion of the subject land that is reserved for parks and recreation.

12 On 18 August 2003, Mr Brett Cross, an officer of the branch assisting Mr Hillyard, wrote to Mr Eftos advising that the WAPC was willing to enter into negotiations for the possible purchase of the reserved portions of the properties, and that two licensed valuers had been engaged to provide current market valuations of the reserved portions. The letter asked for a copy of Mr Eftos' authority to represent the owner of the land.

13 On the same day, Mr Cross instructed valuers. His letters to the valuers pointed out that, in 1986, a former owner of the properties had obtained approval to amalgamate the properties subject to a condition that part of the reserve land be ceded to the Crown free of cost. While a diagram for that amalgamation had been approved, no application for a new certificate of title had ever been made, and the reserve land had accordingly never been ceded.

14 Valuations were subsequently provided to the branch valuing the reserved portion of the land at $1 235 000 and $1 100 000 respectively.

15 On 7 October 2003, Ms Janine Egan, an officer of the respondent dealing with the amalgamation and subdivision application, sent a memorandum to Mr Hillyard advising him of the application and seeking his comment "including whether the Commission is likely to acquire the reserved portion of the Sin-Aus-Bel Pty Ltd's landholdings". The following day, Mr Cross responded to that memorandum advising of the approach that had been made for purchase of the land, and of that fact that valuations were being sought. He stated that "negotiations for the purchase of the reserved land would not take place until settlement has occurred between the current owner and the purchaser (which is subject to subdivision and development approval)".

16 Among the documents tendered at hearing is a handwritten memorandum dated 20 October 2003 which appears to record a meeting between Mr Cross and Ms Egan. The note records that "commercial and asset services division is supportive of a condition being imposed on the approval for subdivision application 121503 requiring that foreshore reserve lot be ceded to the Crown free of cost particularly given the intensity of development proposed for site".

17 Ms Egan prepared a report on the subdivision application to the Commission on 20 October 2003. It records that the commercial and assets services division "recommends" the imposition of a condition requiring the reserve lot to be ceded to the Crown free of cost. The report also records that that position is supported by Commission's Policy DC 2.3 "and is considered reasonable given the intensity of residential development that can potentially occur under the mixed business zoning, as demonstrated by the current development application". The report, which was subsequently approved by the Commission, recommends the imposition of the condition which is the subject of this review.

18 The Commission's approval of the subdivision subject to conditions was given on 29 October 2003 and communicated to the owner's agent by letter dated 30 October 2003. On 3 November 2003, Mr Cross wrote to Mr Eftos advising that, at the time he had written on 18 August 2003, the Department was not aware that Mr Eftos' firm was representing the proposed purchaser of the properties as opposed to the registered owner. The letter proceeded:

[29]

19 It is against the background of the unfruitful negotiations for purchase of the reserved land that the applicant makes a number of contentions in these proceedings. The applicant's position is that the question of whether Condition 1 should be imposed ultimately turns on its validity. The applicant contends that the condition was not imposed for a planning purpose, was not imposed in good faith, was designed to achieve ends or objects extraneous to any proper planning purpose, does not reasonably and fairly relate to the development, and was so unreasonable that no reasonable planning authority could have imposed it. In making those submissions, the applicant draws upon the statements by McHugh J in Western Australian Planning Commission v Temwood Holdings Pty Ltd [2004] HCA 63; (2004) 221 CLR 30 at [57] where His Honour restated the principle derived from the House of Lords in Newbury District Council v Secretary of State for the Environment [1981] AC 578 at 599, 607 - 608, 618 and 628.

20 It was not in dispute in these proceedings that, for the condition to be sustainable, those conditions of validity must be met. The proceedings before this Tribunal are, however, not proceedings for judicial review which require an examination of the conduct or motives of the decision-maker in reaching the decision under review. Rather, proceedings in the review jurisdiction of this Tribunal are by way of a hearing de novo, with the objective of producing the correct and preferable decision at the time of the decision upon the review - State Administrative Tribunal Act 2004 (WA) s 27. It is not, therefore, necessary for the Tribunal to determine whether the respondent acted in good faith in relation to the application nor whether its purpose in imposing the condition was to avoid the expense of purchasing the reserved land rather than for some proper planning purpose. Clearly the imposition of the condition cannot be supported if the reason for it is to avoid the State having to meet the cost of acquiring the land. That the condition may incidentally have that effect does not, however, lead to the conclusion that the condition must be invalid, nor that the discretion to impose it should necessarily be exercised in the applicant's favour.

21 The respondent's contention at the hearing was that the condition does serve a legitimate planning purpose, was reasonably related to the development, and, in all the circumstances, is reasonable. It is those three issues which fall for determination in the context of these proceedings. The history of negotiations for purchase of the reserved land is a matter which may be relevant, not the bona fides of the respondent, but to the question of whether imposition of the condition was, in the circumstances, reasonable.

[43]

31 In his witness statement Mr Vincent McMullen, a town planner and a senior officer of the Department of Planning and Infrastructure, outlined the history of open space planning in Western Australia over the past 70 years. His analysis demonstrates that the management and reservation of river foreshore has been the subject of planning instruments going back to 1930.

32 In the context of water courses adjoining residential development, policy DC 2.3 has direct application. It expressly identifies the potential requirement for land to be ceded to the Crown free of cost where required as a reserve for recreation or foreshore management. The underlying planning purpose of conditions of the nature under review emerges from the strategies and policies referred to above.

33 Provided the other requirements for a valid condition are met, it cannot be said that Condition 1 is not designed to achieve a proper planning purpose. As already observed, the question for the Tribunal is not what the subjective purpose of the respondent may have been in imposing the condition, but rather whether, on a consideration of the relevant planning instruments the condition is directed to a proper planning purpose.

34 The applicant contended that the policies of the respondent in relation to ceding of foreshore land as a condition of subdivision or development has not been consistently applied. In support of that contention, Mr Caddy, a planner who gave evidence on behalf of the applicant, referred to three riverside properties where applications for subdivision or amalgamation did not attract conditions requiring ceding of land. In two of those cases negotiations were well underway for purchase of the reserved land by the time the subdivision applications were made, and concerned land in respect of which the governments had established and funded a plan for a green way which required the acquisition of that land. The third subdivision occurred approximately 20 years ago and the evidence in relation to it gave little insight into the surrounding circumstances. The examples raised do not detract from the proposition expressed by the former Town Planning Appeal Tribunal in Swick Holdings Pty Ltd v State Planning Commission (Unreported, TPAT No 7 of 1997, 22 November 1997) that cl 3.2 of Policy DC 2.3 "expresses a long standing principle of planning of the Respondent and [its] predecessors in this State and should be seriously regarded by the Tribunal".

[45]

35 There is a fundamental difference in approach between the parties in relation to this issue. The respondent approaches the application as being part of an overall proposal for a development involving a mix of multiple dwellings, townhouses and a café. It points to the form 1A application for amalgamation and subdivision which identifies the current use of the land as "hotel-motel" and the proposed use of the land as "unit development" and specifies that existing buildings are to be demolished. As Mr McMullen observed in his witness statement, the development application contemplated by the contract of sale was lodged with the City of Belmont on 13 March 2003 and forwarded to the respondent by letter dated 19 March 2003, and thus was before the Commission at the time that the application for subdivision was being considered. The respondent's position is that the ultimate development of the land will impact upon the use made of the foreshore, the desirability of proper management, and facilitation of public access.

36 The applicant's position, however, is that the ultimate development of the land is uncertain, as explained by Mr Turner. The applicant contends that the uncertainty as to the ultimate use of the development lot leads to the position that the Tribunal could not conclude that the ceding of the reserved lot is reasonably required by the application. Rather, the subdivision of the land to separate the reserved lot would simply facilitate the sale of that lot to the Commission.

37 Mr Paul Stephens occupies the position of Manager - Statutory Assessments, with the Department of Environment. He provides administrative and assessment services to the Swan River Trust. He expressed the view that the proposal to develop the subject land for residential purposes is likely to introduce an increased resident population to the immediate area, and lead to increased intensity of use of the foreshore. He also expressed the view that the changes in use of the land since the initial Crown grant, which is continued by the current proposal to develop the land for residential purposes, has necessitated an increase in the size of the foreshore reserve available to the public, and made more important the co-ordinated management of the foreshore. He observed that the subject land derives significant aesthetic, and therefore economic benefit, from its river foreshore location, and expressed the view that the consistent management and conservation of the whole area reserved for parks and recreation by the Swan River Trust and the City of Belmont will further enhance those benefits.

38 Mr Ross Montgomery, a planner who has had considerable involvement in planning in relation to Perth's rivers, noted that the portion of the subject land adjacent to the river has been maintained as an open area for use of hotel patrons and has been utilised by the wider community for recreational purposes. He expressed the opinion that the replacement of the hotel with residential development will change the ability of the local community to access and enjoy the river foreshore immediately adjacent to the subject land. He expressed concern about conflict between private ownership of the adjoining land and community expectations concerning use of the river. He considered that ecological issues associated with the river and the foreshore are best managed in a coordinated way by the State.

39 Mr David Caddy expressed the view that there is no nexus between the subdivision application and Condition 1. On questioning by counsel for the respondent, however, he conceded that the effect of the proposed amalgamation and subdivision will be to allow development to proceed as quickly as possible on the development lot, whatever might be the final form of that development.

40 When the proposed amalgamation and subdivision is viewed, as it was by the respondent, in the context of being a step toward the more intensive mixed use development of the subject land, there is no difficulty in accepting the proposition advanced by Mr Stephens, and supported by Mr McMullen and Mr Montgomery, that Condition 1 reasonably relates to the proposed amalgamation and subdivision. The question is whether the application should be treated in that context, or whether, as the applicant asserts, the application should be seen as no more than a subdivision which facilitates the ultimate sale of the foreshore reserve to the State, with the future of the balance of the land remaining uncertain.

41 In my view, the approach taken by the respondent is the correct approach. It is true that the precise form of future development is at present uncertain, given the rejection of the latest proposal for development by the local authority. It is very clear, however, that the application for amalgamation and subdivision arises in the context of the proposed purchase of the land for the purpose of redevelopment. LPS 14 zones the land as "mixed use". That zoning permits a discretionary approval of group dwellings, a nursing home, residential buildings and single houses. There is no density code applicable to the mixed use zone. Both the original proposal and the modified proposal submitted by the developers involves a significant intensification of the use of the development lot. It would be unrealistic to conclude that the land will not, in the reasonably near future, be redeveloped in a way which intensifies its use, most likely for residential purposes. It was common ground that the amalgamation and subdivision will facilitate that process.

42 In Western Australian Planning Commission v Temwood Holdings Pty Ltd, Mc Hugh J observed, at [72] that:

[51]

46 The applicant argued that the facts in Marford differed from the present case in that the final form of the development was more progressed in Marford. That may be true to some extent, but the distinction does not alter the principle that it is appropriate and desirable, if not obligatory, for the approving authority to consider a subdivision application in the context of the likely future use of the land. In Lloyd v Robinson [1962] HCA 36; (1962) 107 CLR 142 at 152-153, the decision as to when, in the context of a staged development, a condition requiring ceding of land might be imposed was said to be a question within the discretionary judgment of the approving authority. It is not difficult to see the possibility that the opportunity to impose a condition to the effect of Condition 1 may not arise at any other stage of the development approval process. It was open to the Commission, and thus it is open to the Tribunal, to impose the condition on this application for amalgamation and subdivision once the necessary planning purpose and nexus is established.

47 The applicant referred to the decision in Western Australian Planning Commission v Erujin [2001] WASCA 139; (2001) 115 LGERA 24 as being factually very similar to the present application. In Erujin, Miller J in the Supreme Court upheld a decision of the former Town Planning Appeal Tribunal setting aside a condition of a two lot subdivision that required the ceding of one of the two lots adjoining Wungong Brook free of cost. Miller J agreed with the Tribunal that, in the circumstances of that case, the policies relied upon by the Commission had no application and that the condition served no planning purpose related to the proposed subdivision. In this case, however, I have accepted that it is appropriate to approach the amalgamation and subdivision having regard to the context that it constitutes a step which facilitates more intensive development of the development lot, and that there is a relationship of the development to the use and management of the river foreshore. That conclusion leads to a different outcome from that in Erujin.

48 Condition 1 does reasonably and fairly relate to the development.

[52]

49 The applicant contends that Condition 1 is so unreasonable that no reasonable planning authority could impose it. In support of the submission, the applicant contends that the owner of the foreshore lot could properly manage the area pending acquisition of it by the respondent, and thus the planning objectives could be achieved without depriving the owner of title to the land. The respondent's position is that public ownership of the land better facilitates its management and the preservation of public access.

50 It is not difficult to see that, as time moves on and the development lot is developed, with the distinct possibility of ownership of the development lot which differs from ownership of the reserve lot, difficulties in relation to the management and maintenance of the reserve lot may arise. I accept the view expressed by Mr Stephens, that the existence of a residential development, rather than a hotel development as currently exists on the subject land, may well have the effect of deterring public access to the foreshore and increasing the prospect of conflict between residents and members of the public.

51 Against the background of planning policy in relation to foreshore areas, and the potential benefits of public ownership of the foreshore reserve, it cannot be said that the imposition of Condition 1 is unreasonable, even if it is accepted that it may be possible to achieve the desired planning objectives, at least pending ultimate acquisition of the land by the State, with the land remaining in private ownership.

52 Although I have concluded that it is not necessary to examine the negotiations for sale of the land for the purpose of attributing motives to the officers of the respondent in imposing Condition 1, it is appropriate to consider the negotiations to determine whether, given those negotiations, the imposition of Condition 1 is unreasonable.

53 It is conceivable that, where negotiations for purchase of reserved land are well advanced and an application for development is then made on the assumption that the reserved land will be purchased, that an opportunistic imposition of a ceding condition which defeats a well founded expectation that the sale transaction may proceed, might be unreasonable.

54 In my view, that is not the case in this matter. It is true that the preliminary steps to negotiation, and in particular the obtaining of valuations, was underway. Those steps had been taken, however, on the initial assumption that Mr Eftos was acting on behalf of the land owner. (It is not suggested that Mr Eftos was in anyway misleading, and when asked he provided a clear statement of the fact that he was acting on behalf of the syndicate proposing to purchase the land.) I accept that the position taken by Mr Cross, namely that negotiations would not be pursued until settlement of the sale of the land had occurred, so that negotiations were with the registered proprietor of the land, was a decision taken in good faith and for good reason. Although the response to the initial approach by Mr Eftos was positive, and some preliminary steps were taken, the question of purchase of the land had not reached the stage of negotiation. In my view, it was entirely reasonable for the land asset management branch, on learning of the proposed development application, and knowing that the outcome of that application may impact upon considerations relevant to the purchase of the reserved land, to withdraw from further discussions on sale until the position was clarified.

55 Once that had occurred, the question of whether or not Condition 1 should be imposed is a question to be determined by reference to the relevant planning considerations.

Sin-Aus-Bel Pty Ltd and Western Australian Planning Commission [2006] WASAT 266 (1 September 2006)

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Sin-Aus-Bel Pty Ltd and Western Australian Planning Commission [2006] WASAT 266 (1 September 2006)

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