Standard Knitting Mills (Holdings) Pty Ltd v Bayside Council

The site and its context

1. The site is on the eastern side of Sir Joseph Banks Street and on the southern side of Clevedon Street. The site has an area of 7,180sqm.
2. The site is legally described as Lot 1 DP 218889, Lot 25 DP 29743, Lot 26 DP 29743 and Lot A DP 163574.
3. The site contains an existing building with a floor area of 2,138sqm. The remaining site area consists of both sealed and unsealed surfaces used for parking trucks. The site is currently occupied by Roller Truck Australia Pty Ltd.
4. The last approved use of the site, granted in 1993, was for a cloth processing facility consisting of a knitting mill and dye house with ancillary administration offices, storage and car parking.
5. The site contains a raised concrete plinth 6.2m long with curved ends which is, according to the Council's Statement of Facts and Contentions (Ex 6), consistent with a service station fuel filling facility.

Background and the proposal

1. The parties agreed that the proposed use has existed unlawfully on the site for approximately 8 years. The director of Roller Truck Australia Pty Ltd described the operation of the business on the site (Ex A), which can be summarised as follows:

• The day to day operation of the business involves transporting goods which arrive at Sydney Airport or Port Botany Terminal, in response to instructions received in the form of Master Air Waybills (MAWBs) for cargo arriving by air.
• The business receives typically 50-500 MAWBs per working day. Goods typically arrive by air in Unit Load Devices (ULDs).
• Cargo picked up by the business is transported back to the site and unloaded, on the bitumen driveway area immediately outside of the warehouse, or inside the warehouse.
• Depending on the instruction in the MAWB, the goods are either stored at the warehouse or separately loaded onto one or more suitable vehicles for distribution to the customer. Perishable goods are stored as briefly as possible.
• ULDs are either returned or may be briefly stored onsite.
• The business maintains a fleet of trucks at the site. The diversity of trucks in required for the various purposes of the business.

1. The proposal includes the following (Ex A, tab 2):

• New paving including concrete to form part of a truck manoeuvring area and bitumen to provide sealed access for unloaded trucks to park in the northern and north-eastern area of the site adjacent to site boundaries;
• Parking for 19 vehicles on the northern portion of the site, including 15 HRVs, 2 MRVs, 1 Small Rigid Vehicle (SRV) and 1 B99 car;
• Parking for 10 cars in the southern portion of the site, including one accessible space adjacent to the western façade of the existing warehouse;
• Use of the existing warehouse and administration building (area of 2,138sqm) as a warehouse and distribution centre for a variety of goods associated with air freight.

Planning framework

1. The site is zoned B7 Business Park pursuant to the Botany Bay Local Environmental Plan 2013 (LEP 2013). Warehouse or distribution centres are a nominate permissible use in the B7 zone. The objectives of the B7 zone, to which regard must be had, are: • To provide a range of office and light industrial uses. • To encourage employment opportunities. • To enable other land uses that provide facilities or services to meet the day to day needs of workers in the area. • To encourage uses in the arts, technology, production and design sectors.
2. "Warehouse or distribution centre" is defined in the dictionary of LEP 2013 as: warehouse or distribution centre means a building or place used mainly or exclusively for storing or handling items (whether goods or materials) pending their sale, but from which no retail sales are made, and includes local distribution premises.
3. Freight transport facilities, Transport depots and Truck depots are nominate prohibited uses in the B7 zone under LEP 2013.
4. "Freight transport facility" is defined in the dictionary of LEP 2013 as: freight transport facility means a facility used principally for the bulk handling of goods for transport by road, rail, air or sea, including any facility for the loading and unloading of vehicles, aircraft, vessels or containers used to transport those goods and for the parking, holding, servicing or repair of those vehicles, aircraft or vessels or for the engines or carriages involved.
5. "Transport depot" is defined in the dictionary of LEP 2013 as: transport depot means a building or place used for the parking or servicing of motor powered or motor drawn vehicles used in connection with a business, industry, shop or passenger or freight transport undertaking.
6. "Truck depot" is defined in the dictionary of LEP 2013 as: truck depot means a building or place used for the servicing and parking of trucks, earthmoving machinery and the like.
7. The site is classed as 4 by the Acid Sulphate Soils Map (Sheet ASS_005 of LEP 2013) pursuant to cl 6.1(2) of LEP 2013. Works more than 2m below the natural ground surface or works by which the watertable is likely to be lowered more than 2m below the natural ground surface require development consent.
8. Development consent is required for earthworks pursuant to cl 6.2(2) of LEP 2013 unless the earthworks are exempt development under LEP 2013 or another applicable environmental planning instrument (EPI), or the earthworks are ancillary to development that is permitted without consent under LEP 2013 or to development for which development consent has been given. Before granting consent for earthworks, the consent authority must consider the following matters, at cl 6.2(3) of LEP 2013: (a) the likely disruption of, or any detrimental effect on, drainage patterns and soil stability in the locality of the development, (b) the effect of the development on the likely future use or redevelopment of the land, (c) the quality of the fill or the soil to be excavated, or both, (d) the effect of the development on the existing and likely amenity of adjoining properties, (e) the source of any fill material and the destination of any excavated material, (f) the likelihood of disturbing relics, (g) the proximity to, and potential for adverse impacts on, any waterway, drinking water catchment or environmentally sensitive area, (h) any appropriate measures proposed to avoid, minimise or mitigate the impacts of the development.
9. Clause 6.3 of LEP 2013 applies to the site, at (2). Development consent must not be granted to development on land to which the clause applies, at (3), unless the consent authority is satisfied that the development: (a) is designed to maximise the use of water permeable surfaces on the land having regard to the soil characteristics affecting on-site infiltration of water, and (b) includes, if practicable, on-site stormwater retention for use as an alternative supply to mains water, groundwater or river water, and (c) avoids any significant adverse impacts of stormwater runoff on adjoining properties, native bushland and receiving waters, or if that impact cannot be reasonably avoided, minimises and mitigates the impact.
10. State Environmental Planning Policy No. 55 - Remediation of Land (SEPP 55) applies to the site at cl 5 and has the following objects, at cl 2: (1) The object of this Policy is to provide for a Statewide planning approach to the remediation of contaminated land. (2) In particular, this Policy aims to promote the remediation of contaminated land for the purpose of reducing the risk of harm to human health or any other aspect of the environment - (a) by specifying when consent is required, and when it is not required, for a remediation work, and (b) by specifying certain considerations that are relevant in rezoning land and in determining development applications in general and development applications for consent to carry out a remediation work in particular, and (c) by requiring that a remediation work meet certain standards and notification requirements.
11. Clause 7 of SEPP 55 is in the following terms: 7 Contamination and remediation to be considered in determining development application (1) A consent authority must not consent to the carrying out of any development on land unless - (a) it has considered whether the land is contaminated, and (b) if the land is contaminated, it is satisfied that the land is suitable in its contaminated state (or will be suitable, after remediation) for the purpose for which the development is proposed to be carried out, and (c) if the land requires remediation to be made suitable for the purpose for which the development is proposed to be carried out, it is satisfied that the land will be remediated before the land is used for that purpose. (2) Before determining an application for consent to carry out development that would involve a change of use on any of the land specified in subclause (4), the consent authority must consider a report specifying the findings of a preliminary investigation of the land concerned carried out in accordance with the contaminated land planning guidelines. (3) The applicant for development consent must carry out the investigation required by subclause (2) and must provide a report on it to the consent authority. The consent authority may require the applicant to carry out, and provide a report on, a detailed investigation (as referred to in the contaminated land planning guidelines) if it considers that the findings of the preliminary investigation warrant such an investigation. …
12. Botany Bay Development Control Plan 2013 (DCP 2013) applies to the site at section 1.5. The general aims and objectives of DCP 2013 include, at section 1.6: "O5 To minimise negative impacts of development on the amenity of adjoining properties, in particular to reduce the landuse conflict between residential and non-residential uses;"
13. Warehouse or distribution centres require 2 car parking spaces, or 1 space/300sqm GFA, whichever is greater, plus 1 space/40sqm GFA of ancillary office, at section 3A.2 of DCP 2013.
14. Part 3A.3.4 of DCP 2013 includes objectives and controls for onsite loading and unloading facilities. The objectives and relevant control are: "O1 To ensure adequate area within the site is allocated for service and delivery functions; O2 To ensure off-street servicing bays and the access is safe and efficient; and O3 To create safe environments for pedestrian and cyclists. … C5 The service bays shall be located toward the rear of the properties, away from the primary and secondary street frontages and are to be adequately screened from public view."
15. Part 9B.1 of DCP 2013 describes the existing character of the "key site" of Botany South Precinct, which includes the site. The introduction includes the following explanation of the zoning of the precinct: "The Precinct is zoned predominantly B7 Business Park, with a B4 Mixed Zoned around the periphery of the Precinct. The Precinct is surrounded by land zoned for residential purposes. The intention of the B4 zone within the Precinct is to act as a buffer between the B7 area and low density residential area and to enhance and protect the amenity of existing residential dwellings while encouraging the centre of the Precinct to be redeveloped with uses including creative industries, light industrial, warehouses and associated offices."
16. The general objectives for the Botany South Precinct include the following objectives: "O1 To encourage new light industrial, business park development, commercial development and associated offices which are compatible with the capacity of the road network in the Precinct; … O4 To encourage developments which do not require large transport vehicles; … O6 To encourage low scale mixed use development with medium density housing and a range of compatible vibrant uses such as shops, professional offices, and studio/workshops which are not impacted by adjoining industrial and commercial uses and that do not impact on adjoining and adjacent residential amenity;"
17. The existing local character, at Part 9B.2.1 includes the following explanation of the strategic vision for the precinct: "Council has consistently restricted the size of delivery vehicles in all development consents issued to medium rigid vehicles. … Constraining factors include: The Precinct is surrounded by and contains scattered residential dwellings which have resulted in complaints from residents and constraints on operating times; Poor building quality with low clearance levels; Limited off-street parking; Limited public transport; and No room for expansion."
18. Part 9B.3 describes the desired future character of the B7 Business Park zone and includes objectives and controls for the B7 zone. The desired future character of the B7 zone is: "The B7 zone within the Botany South Precinct is anticipated to develop into a high quality business area with a mix of light industrial, creative industries, commercial, business and warehouses. It is anticipated that larger sites will contain business parks with a mix of uses and associated offices. New works in the public domain will be required such as landscaping and pedestrian corridors to improve the amenity of the Precinct and encourage pedestrian movement."
19. The relevant objectives for the B7 zone in the Botany South Precinct include: "O1 To encourage new light industrial, business park development and commercial development and associated offices in the Precinct which are compatible with the capacity of the road network in the area; … O7 To encourage developments which do not require large transport vehicles;"
20. The relevant controls for the B7 zone in the Botany South Precinct include: "C18 The layout and orientation of buildings on lots greater than 1,000m² shall be in a manner that minimises lengthy or deep areas of car parking along the street frontage (refer to Figure 3 [below])."

Expert evidence

1. The applicant relied on the expert evidence of Philip North (planning), Lyle Marshall (traffic and stormwater) and Denny Bolatti (contamination). The Council relied on the expert evidence of Christopher Lazaro (planning), Craig McLaren (traffic), Samuel Arulananthan (stormwater) and Judith Betts (contamination).

Submissions

1. The applicant submitted that no complaints have been received by the business regarding its operation or truck movements.
2. The applicant submitted that the trucks are no longer serviced on the site. According to the applicant's submissions, the site was used for servicing trucks for a period of time, which the applicant acknowledged has "muddied the waters" in regard to the Council's characterisation of the existing business.
3. The applicant submitted that the permitted with consent use in the B7 zone is "warehouse or distribution centres". There is some overlap between the various permissible and prohibited uses under LEP 2013 and the proposal can be characterised as a distribution centre.
4. The applicant submitted that the proposal is not a significant redevelopment of the site, as the physical works are limited to "150mm above ground" and consent could have been sought by way of a complying development certificate (s 4.27 of the EPA Act).
5. The applicant submitted that numerous provisions of DCP 2013 do not apply to the proposal and the proposal should not attract that sort of analysis, because the proposed use seeks only to occupy the existing facilities on the site. The existing building is a dated warehouse that significantly underutilises the development potential of the site. Presumably, at some time in the future, the landowner will seek to realise the full development potential of the site. At this time, the director of the business is seeking consent for a use that can be assumed to be transitional.

Contamination

1. The contamination experts agreed that the land is contaminated (within the meaning contaminated land as defined under Sch 6 to the EPA Act) and that insufficient information has been provided by the applicant to determine whether the land is suitable in its contaminated state (or will be suitable, after remediation) for the purpose for which the development is proposed to be carried out.
2. The applicant submitted that, if all other matters are satisfied, the Court could make such findings and then give the applicant an opportunity to address the requirements of cl 7(1) of SEPP 55. The Council strongly opposed this course of action on the basis that the applicant has had plenty of time to address the requirements of cl 7(1) of SEPP 55 and has not done so.
3. The requirement under cl 7(1) of SEPP 55 that the consent authority (or the Court exercising the function of the consent authority) must not consent to the carrying out of any development on land unless the consent authority is satisfied, for contaminated land, that the land is suitable in its contaminated state, or will be suitable after remediation, for the development, is a jurisdictional pre-condition to the grant of consent.

The proposal is contrary to the strategic vision for the B7 zone in the South Botany Precinct

1. According to Mr McLaren, a very large proportion of the site is allocated for the use of truck parking, truck manoeuvring and truck loading/unloading within the large unenclosed concrete area on the northern portion of the site. These activities occupy approximately 52% of the site area. In his experience, warehouse and distribution centres have much larger building footprints with fully or partially enclosed loading/unloading areas within buildings. Mr Marshall disagreed with Mr McLaren's evidence and noted that the actual area designated for truck parking is 753.75sqm.
2. According to Mr McLaren, there are lengthy road segments in the vicinity of the site where a truck longer than a MRV cannot pass an opposing car or truck. In his view, the proposal will result in an increasing frequency of vehicles reversing along Sir Joseph Banks Street. According to Mr Marshall, there is a low probability that a truck will meet an oncoming truck when traversing Sir Joseph Banks Street.
3. According to Mr Marshall's traffic volume count on 15 October 2019, a typical day in his opinion, 16 vehicles larger than a MRV entered the site between 7am and 5pm. According to Mr McLaren's traffic volume count on 2, 10 and 11 June 2021, there were 27 vehicles, including 11 trucks, during an hour on the morning of 2 June; and 25 vehicles, including 12 trucks, during an hour on the morning of 10 June. According to Mr McLaren's traffic volume count, there were 26 HRV and 33 smaller truck movements on 2 June, and a similar number of truck movements on 10 June and 11 June.
4. Mr McLaren noted that the sample of 4 MAWBs attached to Ex A is very small when considering that the business receives between 50 and 500 MAWBs per day and the MAWBs provided are not referenced to the trucks used to transport those goods. In Mr McLaren's opinion, the truck movements surveyed should have been allocated to the applicable MAWB or MAWBs, so as to be able to predict the number of truck movements with reference to the daily receipt of MAWBs. Furthermore, no details are provided regarding the movements of contractor vehicles. In Mr McLaren's view, daily records of inbound and outbound truck dispatches should be readily available and should have been provided to the applicant's expert to confirm that the day surveyed was in fact a "typical" day in terms of truck movements.
5. According to Mr Marshall, a small number of HRVs operating with a Driver Code of Conduct and Traffic Management Plan is acceptable. In Mr McLaren's view, the Driver Code of Conduct is not enforceable and will not achieve an acceptable safety outcome, because there are currently 20 employees of the business and 41 contractors and the details of the arrangements between the applicant and each contractor is unknown. According to Mr Marshall, the proposal is for a warehouse and distribution centre with "special truck needs".
6. I accept and prefer Mr McLaren's evidence. On the three days surveyed by Mr McLaren, there were approximately 26 HRV truck movements per day, in addition to 33 MRV and SRV truck movements per day. The location and spacing of truck passing opportunities within the public road segment where a truck longer than an MRV can conveniently and safely pass an opposing vehicle are limited and a function of opportunistic "gaps for driveways" in the parking on either side of Sir Joseph Banks Street, to the south of the site and in the direction of the Sydney Airport and Port Botany Terminal, as illustrated by Mr McLaren's analysis in Annexure C to Ex 3.
7. The proposal includes a level of truck activity, specifically that of HRVs, that is contrary to the strategic vision for the B7 zone in the South Botany Precinct given by DCP 2013.
8. The provisions of a development control plan must be taken into consideration in determining an application (s 4.15(1)(a)(iii) of the EPA Act), as a "fundamental element" and as a "focal point" of the assessment process (Zhang v Canterbury City Council (2001) 51 NSWLR 589; [2001] NSWCA 167 at [75], [77]). It is also necessary to consider any alternative solutions to achieve the objects of the provision, pursuant to s 4.15(3) of the EPA Act.
9. The provisions under Part 9B.3 of DCP 2013 for the B7 zone in the Botany South Precinct anticipate business park development which is compatible with the road network in the area and does not require large transport vehicles. The proposal, with 18 trucks, of which 15 are HRVs, is fundamentally inconsistent with the objectives for the B7 zone under DCP 2013. The proposal is incompatible with the capacity of the road network in the area because there are limited opportunities for a HRV to pass oncoming traffic, and it is inconsistent with the surrounding residential development, because the proposal is not restricted to MRVs. The proposal does not include a limit on truck movements and so on a day when the business receives 500 MAWBs, the truck movements could potentially increase manyfold.
10. The proposal locates the substantial area of the site devoted to truck manoeuvring and parking adjacent to the street frontage of the site.

Characterisation of the proposed use

1. I accept the Council's contention that the purpose of the proposal is not for a "warehouse and distribution centre" (as described by the Statement of Environmental Effects, Ex A, tab 2, pp 11 and 18).
2. The general concept of the use or uses of land as being for a purpose and the purpose is the end to which the land is seen to serve (Kitto J in Shire of Perth v O'Keefe (1964) 10 LGRA 147; 110 CLR 529) has prevailed in the caselaw as a valuable guide (AMT Planning Consultants Pty Ltd t/as Coastplan Consulting v Central Coast Council (2018) 238 LGERA 116; [2018] NSWCA 289, 138). The characterisation of the purpose of a development must also be done in a common sense and practical way (Chamwell Pty Ltd v Strathfield Council (2007) 151 LGERA 400; [2007] NSWLEC 114 at [45]). The nature of the use needs to be distinguished from the purpose of the use and uses of different natures can serve the same purpose (Botany Bay City Council v Pet Carriers International Pty Ltd (2013) 201 LGERA 116; [2013] NSWLEC 147 at [27]). The use of land can be for two or more purposes (Botany Bay City Council v Pet Carriers International Pty Ltd [2013] NSWLEC 147 at [28]) per Preston CJ, as follows: "A use of land can also be for two or more purposes. The purposes may or may not be conflicting. Non conflicting purposes have similarities in character. An example of non conflicting purposes are those which have a genus-species relationship: one purpose is a genus (such as "industries") and the other purpose is a species falling within that genus (a particular kind of industry such as "extractive industry" or "rural industry"). Conflicting purposes are different in character. Where land is used for two conflicting purposes, difficult questions of construction and characterisation can arise when the environmental planning instrument permits one purpose but prohibits the other. It may be necessary to ascertain, having regard to the character, extent and other features of the uses, whether the prohibited purpose can be regarded as subsumed in the permissible purpose, so that it is legitimate to disregard the prohibited purpose and treat the permissible purpose as that for which the land is used, or whether they are independent of each other so that the land is being used for both prohibited and permissible purposes."
3. "Warehouse or distribution centres" are a nominate permissible use in the B7 zone under LEP 2013. A warehouse or distribution centre is defined by LEP 2013 as: warehouse or distribution centre means a building or place used mainly or exclusively for storing or handling items (whether goods or materials) pending their sale, but from which no retail sales are made, and includes local distribution premises.
4. The warehouse area on the site is 1300-1500sqm, which represents approximately 20% of the site area. During the site view, the warehouse was significantly underutilised for the sorting and storage of goods. The majority of the site area in the proposal, over 3,643.28sqm, is devoted to the parking and manoeuvring of trucks, including 15 HRVs, 2 MRVs and 1 SRV.
5. I am not satisfied that the use of the proposal can be properly characterised as being for a "warehouse or distribution centre". The majority of the area of the site is devoted to the parking and manoeuvring of trucks and the predominant use of site is for the parking of a substantial number of trucks and the sorting of goods for transporting. The proposal is not to use the place mainly or exclusively for storing or handling items.
6. The deletion of the servicing of trucks from the proposal does not exclude the characterisation of the use of the proposal as being for a transport depot, because the definition of a transport depot is a place used for the parking or servicing of motor powered or motor drawn vehicles used in connection with a … freight transport undertaking. The deletion of the servicing of trucks from the proposal does exclude the proposal from the defined use of "truck depot" under LEP 2013, because a truck depot is a building or place used for the servicing and parking of trucks.
7. The use of the existing warehouse building for loading, unloading and transferring goods, as well as storage, is ancillary to the purpose of the proposal. It is reasonable and necessary for a warehouse or distribution centre to provide an area for the delivery of goods by truck, but this would be subordinate to the purpose of a warehouse or distribution centre. This is not what is existing on the site or proposed by the application. I do not accept that the truck parking on the site is merely ancillary to the warehouse and distribution centre use proposed by the application. Having regard to the character, extent and other features of the uses, the prohibited purpose, "transport depots", cannot be regarded as subsumed in the permissible purpose, "warehouse or distribution centres". It is therefore not legitimate to disregard the prohibited purpose and treat the permissible purpose as that for which the land is used. The two purposes are not independent of each other, so that the land is being used for both prohibited and permissible purposes, because the sorting and storage of goods on the site is a function, an ancillary function, of the freight transport business currently operating on the site.
8. I accept and agree with Mr Lazaro's observation that the MWABs provided (Ex A, tab 2) each nominate a consignee for the cargo the subject of each MWAB, which demonstrates that the cargo has already been purchased and is to be transported from the airport to the consignee, possibly via the site. This documentary evidence in the MWABs indicates that the purpose of the business is not warehousing and distribution, because each MWAB provided nominates a consignee. There is no refrigeration provided on the site, or proposed by the application, and so the perishable goods cannot be stored on the site. It appears, from all of the evidence before me, that goods are sorted, and trucks are loaded and unloaded on site, generally from one transport vehicle to another.
9. The proposal cannot be properly characterised as being for a warehouse or distribution centre because the proposal does not meet the definition of a building or place used mainly or exclusively for storing or handling items (whether goods or materials) pending their sale… A warehouse or distribution use would reflect the dominant purpose of the development being to store goods onsite pending their sale, and this is not what is proposed.

Conclusion

1. I am not satisfied that the contaminated land is suitable in its contaminated state, or will be suitable after remediation, for the development. Consent cannot be granted to the proposal because the applicant, by its own admission, has not demonstrated that the jurisdictional pre-condition to the grant of consent under cl 7(1) of SEPP 55 has been met.
2. The significant traffic generation resulting from trucks entering and exiting the site will adversely impact on the amenity of the area, particularly the adjacent B4 and nearby R2 and R3 zones. The road width of Sir Joseph Banks Street is narrow and the presence of parking on both sides of the street restricts the functional width of the street to accommodate trucks bigger than a MRV. The location and spacing of truck passing opportunities within the public road segment where a truck longer than a MRV can conveniently and safely pass an opposing vehicle are limited. The proposal includes a level of truck activity, specifically that of the HRVs, that is inconsistent with the strategic vision for the B7 zone in the Botany South Precinct under DCP 2013.
3. As the proposal cannot be properly characterised as being for a warehouse or distribution centre, the proposal is prohibited development in the B7 zone under LEP 2013.

Orders

1. The orders of the Court are: 1. The appeal is dismissed. 2. Development Application No. 2020/50 for the demolition of existing concrete areas and construction of new hardstand, and use of the site as a warehouse and distribution centre, at 40 Sir Joseph Banks Street, Botany, is refused. 3. The exhibits, other than Exhibits 6, B and C, are returned.

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