South East Forest Rescue Inc v Allied Natural Wood Exports Pty Ltd and Anor - [2021] NSWLEC 89 - NSWLEC 2021 case summary — Zoe

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South East Forest Rescue Inc v Allied Natural Wood Exports Pty Ltd and Anor

[2021] NSWLEC 89

Land and Environment Court (NSW)|2021-08-23|Before: Robson J, Mr J, Mr P, Pepper J

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At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2021-08-23

Before

Robson J, Mr J, Mr P, Pepper J

Catchwords

(1987) 64 LGRA 177 Aldous v Greater Taree City Council [2009] NSWLEC 17
(2009) 167 LGERA 13 Belmorgan Property Pty Ltd v GPT Re Ltd [2007] NSWCA 171
(2007) 153 LGERA 450 Centro Properties Ltd v Hurstville City Council [2004] NSWLEC 401
(2006) 151 LGERA 158 Kindimindi Investments Pty Ltd v Lane Cove Council [2007] NSWCA 38

Source

Original judgment source is linked above.

Catchwords

(1987) 64 LGRA 177 Aldous v Greater Taree City Council [2009] NSWLEC 17(2009) 167 LGERA 13 Belmorgan Property Pty Ltd v GPT Re Ltd [2007] NSWCA 171(2007) 153 LGERA 450 Centro Properties Ltd v Hurstville City Council [2004] NSWLEC 401(2006) 151 LGERA 158 Kindimindi Investments Pty Ltd v Lane Cove Council [2007] NSWCA 38

Judgment (15 paragraphs)

[1]

EX TEMPORE JUDGMENT (REVISED)

In these Class 4 judicial review proceedings commenced by summons filed 4 December 2020, South East Forest Rescue Inc ('South East') seeks declaratory and consequential injunctive relief in relation to a development consent purportedly granted by Bega Valley Shire Council ('Council') to Allied Natural Wood Exports Pty Limited ('Allied') on 4 September 2020, for development relating to the expansion of an existing chip mill at Eden, NSW. The summons filed 4 December 2020 was amended on two occasions, once on 22 February 2021, and more recently (in circumstances I will come to) yesterday, on 23 August 2021, at the commencement of the hearing.

[2]

Procedural history

The hearing of these judicial review proceedings proceeded before me yesterday via Microsoft Teams in accordance with the Court's COVID-19 Pandemic Arrangements Policy. While it was set down for three days, it was completed in one day. Mr J Lazarus of senior counsel, appeared with Ms L Sims of counsel, for South East. Mr P McEwen of senior counsel, appeared with Dr S Berveling of counsel, for Allied, and Mr M E McMahon, solicitor, appeared for Council.
At the commencement of the hearing yesterday, Allied moved on a notice of motion filed 16 August 2021. While originally made returnable before the Court on 20 August 2021, by order of Pepper J on 18 August 2021, the motion was set down for hearing before me on the first day of the judicial review proceedings. The motion sought a further amendment to the amended summons, through the inclusion of new ground 1A, as follows: "1A The decision to grant the Development Consent was invalid because the officer of the Second Respondent who made it did not have delegated authority to do so. Particulars a. The decision to grant the Development Consent was made by the Manager, Planning and Sustainability. b. The Second Respondent's Register of Delegations does not record a delegation of the function of determining development applications from the Second Respondent to the General Manager. c. In the premises, the purported sub-delegation of the function of determining development applications from the General Manager to the Manager, Planning and Sustainability was ineffective or invalid."
Having heard short argument, and by agreement between the parties, I granted leave to further amend the amended summons (hereinafter the 'further amended summons').
Prior to the further amendment of the amended summons on 23 August 2021, the essence of South East's pleadings in each of the previous summonses were grounds relating to: first, that Council failed to consider the harvesting of timber from native forests in the Eden region as part of the development for which the development consent was sought; second, that Council misdirected itself as to the requirement to consider these harvesting impacts; third, that Council's failure to make inquiries and to consider harvesting impacts lacked any evident or intelligible justification; and fourth, a discrete attack upon the earlier decision of Council that the development did not constitute designated development. Suffice it to say that at the hearing before me on 23 August 2021, these grounds set out in the previous summonses were not considered, although they remained in the further amended summons.
The hearing proceeded on the sole basis of new ground 1A, being that the purported development consent was invalid because the officer of Council who granted the development consent did not have delegated authority to determine the development application.
It appears that Allied was first informed of the new ground 1A on 13 August 2021. Having undertaken inquiries, Allied thereafter did not oppose the grant of some form of declaratory relief in the judicial review proceedings (although it proffered a different wording to that which was sought by South East). However, Allied opposed any immediate injunctive relief being granted.
As it was, the hearing proceeded, and the Court received evidence and submissions primarily directed to the appropriateness and nature of the consequential injunctive relief to be granted by the Court.

[7]

Council's position on delegation

Despite Council filing on 3 February 2021 (and thereafter maintaining) a submitting appearance, which noted that Council "submits to the making of all orders sought, and the giving or entry of judgment in respect of all claims made, save as to costs", at the hearing, Mr McMahon made a short submission based upon his more recent instructions. I note this because the principal parties were otherwise agreed that South East's new ground 1A regarding delegation was cause for declaratory relief.
Mr McMahon clarified that Council did not oppose the granting of leave to South East to file the further amended summons. However, in relation to the grant of declaratory relief, despite the agreement between the principal parties, Mr McMahon brings to the Court's attention the following comments by Basten JA, which, as I understand the position adopted by Mr McMahon on behalf of Council, may militate against the position otherwise agreed between the principal parties. In Belmorgan Property Pty Ltd v GPT Re Ltd [2007] NSWCA 171; (2007) 153 LGERA 450 ('Belmorgan') at [67], his Honour stated: "The Council was not required to determine the application itself: there had been, on 7 April 2004, a resolution, the validity of which was not in question, delegating to the general manager 'all of the functions of Council as provided in the Act, subject to any policies and procedures that may be determined from time to time'. The reference in that resolution to 'the Act' was a reference to the Local Government Act 1993 (NSW) and, although the relevant function was conferred by s 80 of the [EPA Act], it was common ground that that function was within the phrase 'as provided in' the Local Government Act, because s 22 of the Local Government Act provides that a Council 'has the functions conferred or imposed on it by or under any other Act or law'."
That was the extent of the submissions made on behalf of Council.
As noted above, Mr McEwen accepted that the inclusion of new ground 1A regarding delegation in the further amended summons was determinative of these judicial review proceedings, although, as noted below, he made no concessions in relation to South East's other grounds pleaded in the previous summonses, which were denied.
Mr McEwen responded to Mr McMahon's submission by pointing to the terms of the actual delegation to the General Manager in these proceedings, in particular the delegation document "Council Register of Delegations - Part 1 Version 14 dated 9 October 2020". This document, as I have indicated earlier, specified Council's delegations to the General Manager and provided a list of the 15 delegations.
In this respect, Mr McEwen submitted that the comments made by Basten JA in Belmorgan, which related to a broad delegation of "all of the functions of Council, as provided in the [Local Government] Act…", do not assist in these proceedings where the actual delegations were set out in 15 specific headings, none of which included a delegation of power to determine development applications under the EPA Act. Mr McEwen noted that despite the delegation of a number of powers from Council to the General Manager, the parties are "left with a lacuna" because the power that is relevant in these judicial review proceedings (being the power to determine development applications under the EPA Act) was not the subject of a delegation to the General Manager.
Mr Lazarus adopted and relied upon the submissions of Mr McEwen.

[9]

Consequential injunctive relief

Before considering the submissions made by the parties in relation to the substantial matter remaining for my consideration, being that South East seeks an immediate injunction to stop any further work being undertaken in accordance with the purported development consent, some further background is appropriate.
For convenience, I adopt and repeat the following evidence from the affidavit of Mr Pretty: "8. The building of the works commenced after the consent approval was granted 4 September 2020. Work has been progressing since then save interruptions caused by COVID restrictions and significant weather events. 9. The value of the works is about $17m. There remains a small proportion of the works to complete construction of the works. 10. The works that remain to be done include: a. installing the briquette plant, b. completing the electrical installation works for sawmill and briquette equipment, c. making safe the plant installation, d. completing the services installation works, e. completing the stormwater works to control the water run-off from the sheds, site rectification works and f. the commissioning of the plant and equipment. At the current rate of construction the commissioning will commence on the saw line in three weeks and the briquette plant in seven weeks. 11. There are three sheds (as part of the works) which now have roofs and guttering but no down pipes or connection to the stormwater system. The roofs were completed in the last 2-3 weeks. A 4.5ML concrete tank is being refurbished to receive this stormwater from the buildings. At the last rainfall when the roofs were on but there was no guttering, significant erosion occurred around the perimeter of buildings and on adjacent areas of the site which has now just been made good. 12. In the event an injunction is made by the Court to cease 'the works subject of these proceedings there are two possible impacts for the First Respondent. 13. The impacts either to (1) pay the workers on the works 'retention\ money' until the Second Respondent reconsiders DA 20.8181 or (2) put these workers off. 14. I am informed that the Second Respondent will reconsider the DA 20.8181 on 22 September 2021when the next Council meeting is scheduled 15. There are currently 25 construction workers on site including the trades people; electrical and construction. 16. The estimated cost of paying sit down money is over $200,000. 17. Six weeks ago 12 electricians working under the Head Contractor, Sawmill who were from New Zealand were required to return to New Zealand in order to avoid strict quarantine rules for NSW. In order to fill these positions, in the absence of the necessary number of locally experienced electricians the sawmill Electrical Sub-Contractor had to bring qualified people from other Local Government Areas within NSW (LGAs) and the States of Victoria, Queensland and ACT. We have had to cancel the ACT due to COVID-19 as they were prohibited from travelling due to restrictions. 18. The filling of these positions took 3 weeks to build up to 9 electrical trades personnel 3 of whom have been withdrawn again due to COVID-19 protocols. The Electrical Sub-contractor is still looking for additional electricians to get to their full complement of 12. 19. In the past six weeks the Covid Health orders relating to NSW, have become stricter. There is a fear and apprehension that the COVID Delta infections numbers will increase and with that restrictions will be more restrictive across all States, Victoria, NSW and Queensland. 20. The time to finish the electrical wiring of the works, and the stormwater works, is three weeks to seven weeks."
I note, before coming to the submissions, that the background on which I place some weight is that in each of the original summons, the amended summons, and indeed the further amended summons, South East sought declaratory relief and also sought a discrete order restraining Allied from "undertaking any development in reliance on the Consent".
Although the recent amendment in the further amended summons sought relief in relation to the lack of delegation as a primary ground for invalidity of the purported development consent, it is true to say, as Mr Lazarus made clear in his submissions, that it had always been the case that South East sought declaratory and consequential injunctive relief, although the basis of the consequential injunctive relief and declaratory relief changed.

[10]

Submissions on consequential injunctive relief

Each of the principal parties made detailed submissions. Mr Lazarus, emphasising that South East did not seek a demolition order, in summary raised the following matters (with reference to various authorities).
First, the "starting point" is the "conventional order", being that South East, as the successful party, is entitled to relief in relation to an unlawful development consent, to prevent further unlawful works.
Second, Allied is effectively now seeking seven weeks to undertake works which are unlawful in the circumstances, and where there is no compelling evidence - particularly in relation to safety concerns or environmental issues - before the Court to justify the need to undertake the works.
Third, the Court would be concerned to uphold the law, especially the orderly development of land, in circumstances where Allied appears to intend to continue undertaking the works unless restrained. As such, the Court ought not sanction or encourage the development of a practice whereby respondents escalate works during the course of litigation to gain a forensic advantage in relation to the later exercise of discretion in their favour.
Fourth, the Court would have little sympathy given the background of these proceedings and, again by reference to various authorities of this Court, where respondents (or defendants) have not been successful in having consequential relief withheld or softened in circumstances where "commercial decisions" have been taken to continue works in the face of litigation raising the lawfulness of their conduct. This is so even where interlocutory relief has not been sought, where in the present circumstances, Allied was on notice of the consequential relief sought (which included a prohibitory injunction), at least since December 2020. In these circumstances, Allied took a commercial risk in continuing its works.
Fifth, in any event, the evidence sought to be relied upon in the affidavit of Mr Pretty is both ambiguous and unsatisfactory. It is ambiguous as to the timing of the commencement of the works after the purported development consent was granted, and further, how close the works are to completion.
In the above circumstances, Mr Lazarus concludes that the detriment to be suffered by Allied is hardly of a character as to warrant the withholding of consequential injunctive relief. Mr Lazarus accepts that in the circumstances the Court may allow some indulgence in relation to works related to safety.
Mr McEwen, opposing the grant of immediate injunctive relief, highlighted the background leading to the agreed position between the principal parties in relation to the appropriateness of declaratory relief, and the position now adopted by Allied before this Court. Mr McEwen submits that the Court should consider the present agreed position with a clear understanding of the past conduct, and in particular, as I understand his submission, the fact that South East has enjoyed success only in relation to a very recent new ground which raised the question of the absence of legitimate delegation to Council's Manager, Planning and Sustainability, and this position was only communicated to Allied on 13 August 2021.
Mr McEwen further submits that up until that time, both the principal parties had prepared for the hearing, which included marshalling extensive evidence (including expert evidence) in relation to the then primary grounds of South East's application for judicial review - that is, in relation to Council's failure to properly consider the development application, where South East's initial pleadings had concentrated on the impacts of the development on native forest harvesting in the Eden region, and Council's alleged failure to consider those impacts when determining the purported development application.
Under those circumstances, Mr McEwen suggests that Allied considered, and was entitled to consider, that it was on "solid ground" regarding the matters pleaded by South East up until 13 August 2021, being when Allied was informed of the recently raised new ground 1A in relation to the absence of delegation, and had acted accordingly. Since that time, Allied reacted quickly and properly to the changed position. (In passing, I note that these submissions were also raised to deal with the concern raised by South East in relation to the lateness of the provision of Mr Pretty's affidavit).
Mr McEwen submits that the Court is not being asked to sanction unlawful acts, as suggested by South East. Rather, Allied effectively requests the Court to "elasticise" what would otherwise be, according to Mr McEwen, a "disproportionate order", where seven weeks would allow the completion of the building works for the development (and would not involve the active operation of the development).
Further, Mr McEwen submits that Allied's conduct consequent upon receiving the purported development consent was not a simplistic "commercial decision". Allied acted upon a development consent it had received, and it had arranged to commence not insignificant construction before these judicial review proceedings were commenced, which is quite a different factual scenario to that sometimes considered by this Court, where contracts may have been entered subsequent to a party becoming aware of an attack upon a development consent. Mr McEwen again emphasised that the original summons related primarily to the failure of Council to consider the likely impacts of harvesting native forest in the Eden region.

[11]

Principles regarding consequential injunctive relief

With those circumstances and submissions in mind, and taking into account the evidence before the Court, I turn to the principles in relation to the exercise of the Court's discretion to grant consequential injunctive relief.
Sections 9.45 and 9.46 of the EPA Act empower the Court to remedy or restrain a breach of the EPA Act. These provisions relevantly provide: 9.45 Restraint etc of breaches of this Act (1) Any person may bring proceedings in the Court for an order to remedy or restrain a breach of this Act, whether or not any right of that person has been or may be infringed by or as a consequence of that breach. … 9.46 Orders of the Court (1) Where the Court is satisfied that a breach of this Act has been committed or that a breach of this Act will, unless restrained by order of the Court, be committed, it may make such order as it thinks fit to remedy or restrain the breach. (2) Without limiting the powers of the Court under subsection (1), an order made under that subsection may: (a) where the breach of this Act comprises a use of any building, work or land - restrain that use, (b) where the breach of this Act comprises the erection of a building or the carrying out of a work - require the demolition or removal of that building or work, or (c) where the breach of this Act has the effect of altering the condition or state of any building, work or land - require the reinstatement, so far as is practicable, of that building, work or land to the condition or state the building, work or land was in immediately before the breach was committed. …
In Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335; (1987) 63 LGRA 361 ('Sedevcic') at 339-340, Kirby P identified a number of guidelines applicable to the exercise of the Court's discretion pursuant to the then s 124 (now s 9.46) of the EPA Act. It is now well accepted that s 9.46 of the EPA Act permits the Court to soften, according to the justice of the particular circumstances, the application of the rules that would otherwise produce an unjust result in the particular circumstances. His Honour noted in Sedevcic at 340-341: "5. … the obvious intention of the [EPA] Act is that, normally, those concerned in development and use of the environment will comply with the terms of the legislation. Otherwise, if unlawful exceptions and exemptions became a frequent occurrence, condoned by the exercise of the discretion under s 124, the equal and orderly enforcement of the [EPA] Act could be undermined. A sense of inequity could then be felt by those who complied with the requirements of the [EPA] Act or who failed to secure the favourable exercise of the discretion under s 124. … 8. The wide discretion has been described as "an adequate safeguard against abuse of a salutary procedure": see Menzies J in Cooney v Ku-ring-gai Municipal Council (1964) 114 CLR 582 at 605; (1963) 9 LGRA 290 at 306. It permits the court to soften, according to the justice of particular circumstances, the application of rules which, though right in the general, may produce an unjust result in the particular case. Sometimes this "softening" can be achieved by postponing the effect of injunctive relief: see, eg, Woollahra Municipal Council v Carr. Sometimes that evidence will not achieve a just result. The remedy of injunction, with its powerful sanctions, is not, after all, the only remedy available to a local government authority for breaches of the [EPA] Act."
In F Hannan Pty Ltd v Electricity Commission of NSW (No 3) (1985) 66 LGRA 306 at 311, Street CJ noted the power given under the then current EPA Act to "make such order as it thinks fit" enabled the Court to "mould the manner of its intervention in such a way as will best meet the practicalities as well as the justice of the situation before it". His Honour continued at 313: "… It is the duty of that Court, in formulating "such order as it thinks fit", to have regard at all times to the pursuit of the objects of the Environmental Planning and Assessment Act as set out in s 5. This involves, in appropriate cases, the evaluation of matters extending beyond the mere determination of the rights and matters in dispute between the immediate parties. It involves due weight being given to the public interest and the interests of other affected persons in the overall context of the pursuit of the objects broadly set out in s 5. …"
I am also conscious not to give this discretion that resides with the Court, being a mollifying one, an unduly restricted operation. I refer to comments of Kirby P in ACR Trading Pty Ltd v Fat-sel Pty Ltd (1987) 11 NSWLR 67; (1987) 64 LGRA 177 at 82: "Nevertheless, it is important to appreciate the wide scope and purpose of the discretion conferred by s 124 of the [EPA] Act. Clearly, it is not a warrant to set at nought the complicated and sensitively balanced provisions of the legislation, substituting for the operation of the law laid down by Parliament, the personal opinions of the judge hearing the case. On the other hand, it would be equally erroneous to ignore the discretion or to give it an unduly restricted operation. It is just as much part of the structure and scheme of the [EPA] Act, for the enforcement of planning law, as are the other parts."

[12]

Appropriate consequential injunctive relief

Adopting the principles summarised above, and balancing the factors relevant to the exercise of the Court's discretion, I consider that consequential injunctive relief should be granted and that such relief would not, subject to the matters I will come to, work such an injustice as to be disproportionate to the end secured by the enforcement of the EPA Act. While conscious that the relief involves enforcement of a public duty imposed pursuant to the EPA Act, and that the Court should be mindful not to condone conduct in breach of the EPA Act, I consider that the interests of justice requires some softening of the relief otherwise appropriate by allowing a relatively short period of time before any further works or conduct is restrained. In all the circumstances, and for the reasons which I will note, I consider the period of 21 days from the date of this ex tempore judgment balances the interests of justice in relation to the circumstances of the present judicial review proceedings.
I take into account that the conduct of Allied has been in accordance with the purported development consent granted by Council, and although that conduct continued after Allied became aware that there was a challenge to the validity of the development consent, in circumstances where no interlocutory relief was sought and where the nature of the pleadings were being significantly contested by Allied (as evidenced by the marshalling of significant material in relation to what was a relatively serious and not insignificant claim), and in circumstances where, once Allied had been informed that there was a further ground relating to delegated authority to determine the development consent being raised by South East, and it having undertaken inquiries and investigations in relation to the nature and extent of the delegation, it properly engaged with this new position.
While I consider that South East was justified in its criticism of the form and detail of the material otherwise contained in the affidavit of Mr Pretty relied upon by Allied, much of which I have noted earlier, no evidence was called in response thereto, and Mr Pretty was not required for cross-examination. Despite this, although the detail in the affidavit is in a relatively informal and somewhat imprecise form, it is clear that there is some work which is required to be done, in particular in relation to "making safe the plant installation", and "completing the stormwater works to control the water runoff from the sheds, site rectification works". This provides a practical reason for some softening of the relief.
The uncontested evidence in Mr Pretty's affidavit also goes to the fact that although the roofs and guttering had been constructed in relation to the three sheds, there were "no down pipes or connection to the stormwater system", and further, that a 4.5 million litre concrete tank was being refurbished to receive stormwater (presumably from the development). These works alone, in my view, and to some extent as is properly conceded by Mr Lazarus, provide sufficient reason for some softening of the injunctive relief otherwise called for, noting that the evidence is that the whole of the construction and installation works would be completed "without loss or waste in the next three to seven weeks".
In all the circumstances, I consider allowing three weeks (of the seven weeks otherwise said to be required) is appropriate to attend necessary matters. I also note, in relation to the proper concession made by Mr Lazarus in relation to works relating to safety and/or stormwater, that the Court is not in possession of adequate evidence to articulate with the necessary specificity discrete orders that would be able to be properly made and enforced. In those circumstances, I consider the time limitation I have provided for to be fair and reasonable.
I also take into account the conduct of Allied to the extent that it is not suggested in the evidence presently before the Court that its conduct (in the preparation and progression of the development application) in any way contributed to the ultimate reason for which the development consent is to be declared invalid.
Further, while not determinative in my consideration, I have given some weight to the concerns expressed in relation to construction workers on the site, including electrical and construction tradespeople, and the difficulties that have otherwise ensued due to travel restrictions that have been imposed in relation to COVID-19 concerns. I also note that even with the completion of the electrical wiring and the stormwater works, which were estimated to occupy between three and seven weeks, that the development would still not be in a state to operate. I also note that Council itself has not called any evidence, or made any submissions, in relation to the matters otherwise detailed in Mr Pretty's affidavit.
Finally, I do not consider that the evidence before the Court indicates an attempt by Allied to escalate works during the course of litigation to gain a forensic advantage in relation to the later exercise of discretion in their favour, although I am conscious that (albeit in relation to differently configured grounds) Allied was aware that South East was at all times seeking relief in the form of a prohibitory injunction.

South East Forest Rescue Inc v Allied Natural Wood Exports Pty Ltd and Anor

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