Stephen Bowers Architects Pty Limited v Waverley Council

RESPONDENT: Waverley Council FILE NUMBER(S) : 10527 of 2002 CORAM: Lloyd J Question of Law :- preliminary questions of law - State Environmental Planning Policy No. 10 - Retention of Low-Cost Rental Accommodation - "low-rental residential building" - unlawful use must be ignored KEY ISSUES: Evidence: - presumption of regularity LEGISLATION CITED: Local Government Act 1919 Ordinance No. 42 State Environmental Policy No. 10 - Retention of Low-Cost Rental Accommodation cl 3(1), cl 3A(1), cl 3A(3)(b) cl 6 (1) and cl 6(2) Ashfield Municipal Council v Armstrong [2002] NSWCA 269; Bertini v Manly Municipal Council, NSWLEC, Hemmings J, 23 June 1989, unreported; CASES CITED: Glamorgan County Council v Carter [1963] 1 WLR 1; Gozier v Tate (1946) 64 WN (NSW) 1; Minister for Natural Resources v NSW Aboriginal Land Council & Ors (1997) 9 NSWLR 154; Nash v Stielow [1050] VLR 39 DATES OF HEARING: 13/11/2002 DATE OF JUDGMENT: 02/13/2003

JUDGMENT:

9 - IN THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES 10527 of 2002 Lloyd J 13 February 2003 Stephen Bowers Architects Pty Limited ACN 087 958 423 Applicant v Waverley Council Respondent JUDGMENT Introduction 1 The applicant, Stephen Bowers Architects Pty Ltd, has appealed against the deemed refusal by the respondent, Waverley Council ("the council"), of a development application for alterations to a building at No. 28 Sir Thomas Mitchell Road, Bondi. The building, now used as a dwelling, was previously used as a boarding house and/or a house let in lodgings. The alterations are designed to allow the use of the building as a single dwelling. 2 The council now raises for separate determination two preliminary questions of law: (i) Whether the building on the land at No. 28 Sir Thomas Mitchell Road, Bondi is a boarding house. (ii) Whether the Court is required to consider the provisions of State Environmental Planning Policy No. 10 - Retention of Low-Cost Rental Accommodation, in determining this application. The Relevant Facts

The relevant facts may be briefly described as follows. The existing building consists of a two-storey building on land known as No. 28 Sir Thomas Mitchell Road, Bondi. It was erected in 1922 and used for the purpose of a dwelling. Sometime after 1959 the building was used as a boarding house. The council's file, which has been tendered, shows that in 1970 the building was licensed by the council as a boarding house under Ordinance 42 of the Local Government Act 1919, subject to not more than 18 persons residing on the premises. The council's file shows that the building was again licensed as a boarding house in 1971, 1972, 1973, 1975, 1976, 1977, 1978 and 1979. No licence was issued in 1974. In 1980 the building was licensed as a house let in lodgings under Ordinance 42, subject to not more than 15 persons residing on the premises. In 1981 it was again licensed as boarding house, subject to not more than 18 persons residing on the premises; and again in 1982. In 1983 the building was licensed as a house let in lodgings, subject to not more than 14 persons residing on the premises; also in 1984, 1985 and 1986. In 1987 it was licensed as a house let in lodgings, subject to not more than 18 persons residing on the premises. In 1988 the building was licensed both as a boarding house and a house let in lodgings, subject to not more than 14 persons residing on the premises; also in 1989. In 1990 it was licensed as a "boarding house/ 11-20 bedroom"; also 1991, 1992 and 1993. 4 In 1994 Ms S Burrows purchased the property and commenced using it as a backpackers accommodation. In the same year she was issued with a licence for the premises as a "boarding house/11-20 bedroom"; also in 1995, 1996, 1997. The council's file shows that an application was made for a boarding house licence in 1998 and again in 1999, but there is no record of any such licences as having been issued. 5 On 23 April 2001 the applicant, Stephen Bowers Architects Pty Ltd, sent a letter to the council on behalf of Ms Burrows advising that the premises have not been used as a boarding house for the past 43 months and the use of the building as a boarding house has been discontinued. However, the parties have furnished an agreed statement of facts which states that Ms Burrows ceased using the premises as a backpackers accommodation on 10 May 2001 and then commenced using the premises as a dwelling, which remains the present use. 6 On 26 July 2001 the development application which is the subject of these proceedings was lodged. It describes the proposed development as: "use of the existing building which comprises a dwelling as a dwelling along with minor alterations and reductions and refurbishment". 7 At the date of lodging the development application the building was being used as a single dwelling. 8 In 1994, when Ms Burrows purchased the property, the building comprised the following: Ground floor: communal kitchen, bathroom, living and dining room, bedrooms (for backpackers); First floor: bedrooms (for backpackers), manager's bedroom, kitchen, bathrooms, living and dining room. 9 A floor plan of the building shows the internal layout and number of rooms in the period 1983 to 1992. It shows the number of bedrooms on the ground floor as six, and the number of bedrooms on the first floor as six (one of which, I presume, is the manager's bedroom). State Environmental Policy No. 10 - Retention of Low-Cost Rental Accommodation 10 State Environmental Planning Policy No. 10 - Retention of Low-Cost Rental Accommodation ("SEPP No. 10") provides a mechanism for the retention of low cost rental accommodation. Clause 6 specifies the buildings to which it applies. That clause relevantly provides: 6 (1) This Policy applies only to those buildings that are low-rental residential buildings as at 28 January 2000, and does not apply to any building that becomes a low-rental residential building after that date. (2) This Policy does not apply to a building: (a) that comprises a single dwelling, or … 11 The reference to a low-rental residential building is a reference to a description of that phrase in cl 3A of SEPP No. 10. That clause relevantly provides: 3A (1) In this Policy, low-rental residential building means the following: (a) a boarding house, (b) a hostel, (c) a residential flat building containing a low-rental dwelling. … (3) In this Policy, low-rental residential building includes a building: (a) … (b) that was used for a purpose specified in subclause (1) but has been changed unlawfully to another use, or … 12 A boarding house is defined in cl 3(1) of SEPP NO. 10 as follows: boarding-house means a building: (a) that is wholly or partly let in lodgings, and (b) that provides lodgers with a principal place of residence for 3 months of more, and (c) that generally has shared facilities, such as a communal bathroom, kitchen or laundry, and (d) that has rooms with one or more lodgers, and includes a hotel (not being premises to which a hotelier's licence under the Liquor Act 1982 relates ). The Applicant's Submissions 13 Mr I J Hemmings, appearing for the applicant, made the following submissions. (i) SEPP No. 10 does not apply in the present case. (ii) SEPP No. 10 has limited application. The extent of the application of SEPP No. 10 is set out in cl 6. Clause 6(1) does not have the effect of applying SEPP No. 10 in this case because the building does not fall within the definition of "low-rental residential building" either as stated in cl 3A or as expanded in cl 3A(3) for the purposes of applying cl 6(1). Even if the applicant is wrong then the exemption in cl 6(2) operates to exclude operation of SEPP No. 10. (iii) The building was being used as a backpackers accommodation and not as a boarding house as at January 2000, hence was not relevantly within the definition of "low-rental residential building" as stated in cl 3A(1)(a). (iv) Clause 3A(3)(b) impliedly requires consideration only of lawful use; and the use of the building at any time as a boarding house was not lawful. (v) There is no record of consent so as to make the use of the building as a boarding house lawful. (vi) Licences were inconsistently issued by the council for the use of the building as a boarding house in some years and as a house let in lodgings in other years. The two terms are distinct and distinguished in the council's licensing of the premises. (vii) Licences only related to the satisfaction of the health and amenity standards set out in cl 3 of Ordinance No. 42 (Boarding Houses and House Let in Lodgings) and not to the lawfulness of the use of the building as a boarding house. (viii) These licences cannot be relied upon to support the presumption of regularity because, for example, in 1998 the council issued a licence for the use of the building as a boarding house but, in fact, it was unlawfully being used as a backpackers accommodation. (ix) In accordance with cl 6(2), SEPP No. 10 does not apply since the building comprises a single dwelling. (x) The building falls within the definition of "dwelling" in cl 3, namely, "a building or part of a building or a structure designed or used as a separate domicile". Looking at both of the use and the physical layout, there was one domicile within which there was the permanent resident and temporary residents. The Council's Submissions 14 Mr M E McMahon, appearing for the council, made the following submissions. (i) The last lawful use of the premises was a boarding house. (ii) The premises were subsequently used unlawfully as a backpackers accommodation and then unlawfully as a dwelling. (iii) The building thus falls within the definition of low-rental residential building as defined in cl 3A(3)(b). (iv) SEPP No. 10 applies because the building is a low-rental residential building as described in cl 6(1). (v) The building is not a single dwelling and is thus not exempted from the operation of SEPP No. 10 by cl 6(2). 15 Mr McMahon further submits that when the council originally registered the use of the building as a boarding house in 1970, such use was permissible. At the time that the licence was applied for in 1970 there are no council's records to indicate whether a development consent was formally issued for such use. However, Mr McMahon submits that the presumption of regularity should favour a presumption that if a development consent was required then it would had been obtained before the licence was issued. Subsequently the building was unlawfully converted to a backpackers accommodation. Thus by dint of cl 3A(3)(b), SEPP No. 10 applies in this case. Conclusions 16 Reference was made by Mr Hemmings to a number of decided cases. Each case, however, turns on its own facts and I have obtained no particular assistance from any of the cases referred to by Mr Hemmings. 17 In my opinion, in applying the clear words of SEPP No. 10 to the facts of the present case, it is clear that the building is caught by cl 6(1) and is a building to which SEPP No. 10 applies. It was a "low-rental residential building" as at 28 January 2000 as defined in cl 3A(3)(b), in that its last lawful use was as a boarding house, but was subsequently changed unlawfully to another use, namely, backpackers accommodation and again subsequently to a dwelling. 18 In my opinion the presumption of regularity (omnia praesumuntur rite et solenniter esse acta) applies in this case to the issuing by the council of the various licences as either a boarding house, a house let in lodgings, or both. In Minister for Natural Resources v New South Wales Aboriginal Land Council & Ors (1987) 9 NSWLR 154, McHugh JA (Kirby P concurring), referring to the maxim omnia praesumuntur rite et solenniter esse acta, said (at 164): The natural home of the maxim is public law. Where a public official or authority purports to exercise a power or to do an act in the course of his or its duties, a presumption arises that all conditions necessary to the exercise of that power or the doing of that act have been fulfilled 19 McHugh JA continued (at 164): A particular application of the maxim which is relevant to this case is stated in Broom's Legal Maxims, 10th ed (1939) at 642 as follows: "…w here acts are of an official nature or require the concurrence of official persons, a presumption arises in favour of their due execution. In these cases the ordinary rule is omnia praesumuntur rite et solenniter esse acta donec probetur in contrarium - everything is presumed to be rightly and duly performed until the contrary is shown." 20 More recently, in Ashfield Municipal Council v Armstrong [2002] NSWLEC 269 the Court of Appeal applied the maxim in a case involving the use of a building as flatettes. Although there was, in that case, no record of any development consent, the council had in 1953 written a letter to a bank which claimed to have an estate or interest in the land, to the effect that the council offered no objection to the continuing use of the premises as flatettes. Davies AJA (Mason P and Handley JA concurring) in applying the maxim, said (at [40]): Back in 1953, the officers of the Council would have been in a position to check the history of the subject premises. It is contrary to the maxim to require the respondents at the present time to prove what was the state of affairs with respect to the premises back in the 1940's. Had the Council's officers had any concern about the property at the time they could have raised it and the Council could have refused its consent. The consent granted in 1953 has stood for many years and is strong evidence of the fact that the Council legally and regularly consented to the use of the subject premises as a residential building. 21 In the present case the council would not and could not have lawfully issued the licences that it did unless either (a) a development consent had been granted for the use of the building as a boarding house or house let in lodgings, or (b) no such development consent was required in 1970. 22 Since the last lawful use of the premises was a boarding house which was then subsequently changed unlawfully to another use, namely, backpackers accommodation, the building is a low-rental residential building within the description contained in cl 3A(3)(b) of SEPP No. 10. It follows that cl 6(1) applies. 23 The only remaining question is whether the exception in cl 6(2)(a) applies: that is whether the building comprises a single dwelling. If so, then SEPP No. 10 does not apply. 24 "Dwelling" is defined in SEPP No. 10 as follows (cl 3): "dwelling means a building or part of a building or a structure designed or used as a separate domicile". It can be seen that the definition contains two elements. The first element is that the building must be designed as a separate domicile. The second element, framed in the alternative, is that the building must be used as a separate domicile. If either element is present then the building is a dwelling, so that cl 6(2)(a) would apply and SEPP No. 10 would not apply to the building in the present case. 25 It seems to me that the building is not designed as a separate domicile. As noted above, the living area occupied two floors. The ground floor comprises six bedrooms, kitchen, bathroom and living and dining room. The first floor comprises six bedrooms, kitchen, bathroom, living and dining room. The building is designed as at least two domiciles. It does not satisfy the first element of the definition of "dwelling". 26 As to the second element, the building is presently used as a separate domicile. That use is, however, unlawful. (I have assumed that the use for the purpose of a dwelling house is one for which development consent is required - the parties appear to have proceeded on such an assumption.) If it is necessary to rely upon a use which is unlawful then such use must be ignored (Grozier v Tate (1946) 64 WN (NSW) 1; Nash v Stielow [1950] VLR 39; Glamorgan County Council v Carter [1963] 1 WLR 1; A & M Bertini v Manly Municipal Council, NSWLEC, Hemmings J, 23 June 1989, unreported). 27 It follows that the exception in cl 6(2)(a) does not apply. SEPP No. 10 applies to the development which is the subject of this application. 28 The first of the two preliminary questions which the Court is asked to decide is not correctly framed. The question should be: whether the building on the land at No. 28 Sir Thomas Mitchell Road, Bondi is a low-rental residential building. That question is answered in the affirmative. 29 The second preliminary question is whether the Court is required to consider the provisions of SEPP No. 10 in determining this application. This question is answered in the affirmative.

                      I hereby certify that the preceding 29 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice Lloyd.

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