Strathfield Municipal Council v C & C Investment Trading Pty Ltd

Land and Environment Court (NSW)|2018-02-28|Before: Sheahan J, Mr J

Solicitors: Houston Dearn O'Connor (Applicant) Doyle Construction Lawyers (First, second and ninth respondents) CBD Law Gosford (Third respondent) N/A (fourth to eighth, and tenth to forty-second respondents) File Number(s): 2017/316656

Introduction

These Class 4 civil enforcement proceedings concern a large "boarding house" development at 51-55 Homebush Road, Strathfield, at the corner of Oxford Road.
The subject site is within the Homebush Road heritage conservation area, and is home to a heritage item known as "Merriwa". It sits within the "R2" Low Density Residential zone in the relevant Strathfield Local Environmental Plan 2012 ("the LEP"), so boarding houses are permitted with consent.

The main parties

It is common ground that the first respondent ("C & C") is the owner of the site, and the second ("Grandcity") is the builder of the development.
The third, Stanly Spyrou, is a private certifier ("PCA"), who replaced the original PCA for the project (Alex Mullin), on or about 11 September 2017, and issued an Interim Occupation Certificate ("IOC") on 4 October 2017 (see [22]-[25] below).
The Council has, from the outset, been represented by Mr Robert White of counsel, and the two corporate respondents by Mr James Doyle of Doyles Construction Lawyers, instructed by Ms Angela Cai ("Cai").
Cai's father, Ci Lin (or "Cilin") Cai, is sole director and company secretary of C & C (since 25 October 2011), and also a director of Grandcity. Cai herself is a director of only Grandcity (since 20 February 2016).
She has property and project management credentials, and has actively represented both companies, and the subject development, in dealings with Council and bodies such as "WorkCover NSW".

The Court history

This matter first came before me on 7 and 17 November 2017, on questions of interlocutory relief.
On 17 November 2017, apart from hearing argument on the issue of interlocutory relief, and reserving my decision, I also made the following orders and directions: 1. The First Respondent provide to the Applicant by 5.00pm Monday, 20 November 2017 the names and addresses of all tenants residing in the building at 51-55 Homebush Road (as at 17 November 2017). 2. The Applicant be granted leave to file and serve an amended Summons and Points of Claim joining all of the occupants at the building at 51-55 Homebush Road by 24 November 2017. 3. The Applicant be permitted to serve the amended Summons and Points of Claim on the occupants of the building at 51-55 Homebush Road by leaving a copy of those documents in the post boxes of the occupants.
In my reserved judgment, delivered on 22 November 2017 ([2017] NSWLEC 155 at [33]), I made the following further orders and directions, inter alia: (1) Until further Order of this Court, the First and Second Respondents are not to lease, nor cause, permit, or allow any further elements of the premises at 51-55 Homebush Road, Strathfield, or any elements which hereafter become vacant, to be leased or occupied, for residential or any other purpose. (2) Until further Order of this Court, the First and Second Respondents are not to cause, permit, or allow any further advertising of "rooms to let" within the subject premises. (3) Until further Order of this Court, the First and Second Respondents are each restrained from undertaking any work at the premises that is not in accordance with the development consent given by the Court in case 2014/10919. (4) The hearing of the substantive proceedings is expedited. ... (9) Leave is granted for the parties to rely on expert evidence going to the discipline of Environmental Planning/Town Planning. (10) The parties' experts are to confer and serve the parties with a joint report (including any reply evidence) setting out the matters on which they agree and disagree, and the reasons for any disagreement, by Friday, 19 January 2018. ...
It is useful to record here the following paragraphs of my 22 November 2017 judgment: 13 Ms Cai and Doyle made a number of complaints about the attitude and behaviour of both Council and its officers, Doyle alleging a "campaign of harassment" by Council against the Cais, attacking the qualifications of Dunn ..., and raising a defence of "unclean hands" against the Council. 14 In their submissions filed 15 November 2017, the respondents also took the point (pars 1.1.7 and 5.5) that "proper parties have not been joined", in that present occupants of the subject premises will be directly affected by the interlocutory and some final orders sought by Council, and were not (yet) parties to the proceedings. ... 20 The respondents say that council's stance in this matter (a) is "grossly disproportionate" to whatever breaches may have occurred - which Doyle says are only minor or technical - and (b) is "unduly oppressive" to the two corporate respondents. ... 27 Essentially, the Council says (1) that the corporate respondents removed from their proposal certain elements to which Council objected, (2) that they so secured an approval from the Court, and (3) that they then departed from the Court-approved plans to re-incorporate those objectionable elements in the project as executed, thereby undermining the development approval regime, and causing potential harm to neighbourhood amenity, especially the adjacent school. 28 The Council does not claim that there is any fire risk or other physical danger posed to any occupants of the premises or other property or citizens, but asserts adverse amenity impacts on the neighbourhood, and seriously challenges the occupation certificate upon which the respondents appear to have relied in letting the units. The respondents will defend the certificate (see subs, section 2).
Also on 22 November 2017, the Amended summons and Amended POC ("APOC") were filed, in accordance with the leave granted on 17 November 2017 (see [11] above).
The amended summons claimed the following relief: 1. That the First Respondent and the Second Respondent must as from the date of these Orders do all things necessary so as to comply with the Development Consent given by the Court in Case 10918 of 2017, in that they must comply with Condition 1 of Part B - Operational Conditions, and specifically the development must be built in accordance with and is to comply with the following plans that are referred to in Condition 1 of Part B of the Consent: i. Basement Plan, Drawing No. A1200, Issue D, prepared by Ghazi AI Ali dated 21 May 2015. ii. Ground Floor Plan, Drawing No. A1201, Issue G, prepared by Ghazi AI Ali dated 21 May 2015. iii. Level 1 Plan, Drawing No. A1202, Issue G, prepared by Ghazi AI Ali dated 21 May2015. iv. Level 2 Plan, Drawing No. A1203, Issue G, prepared by Ghazi AI Ali dated 21 May 2015. v. Elevations, Drawing No. A1500, Issue F, prepared by Ghazi AI Ali dated 15 May 2015. vi. Elevations, Drawing No. 1501, Issue F, prepared by Ghazi AI Ali dated 15 May 2015. vii. Sections, Drawing No. A1700, Issue E, prepared by Ghazi AI Ali dated 8 May 2015. viii. Roof Plan, Drawing No. A1204, Issue E, prepared by Ghazi AI Ali dated 21 May 2015. ix. Material Finishes Schedule, submitted in accordance with Deferred Commencement Condition 2. x. Conservation Works Schedule ("Merriwa"), prepared by Graham Brooks and Associates, dated July 2014. 2. That the Occupation Certificate 17/0210-01 issued by Stan Spyrou (BPB1977) and determined on 4 October 2017 is declared to be invalid. 3. The First Respondent must cause occupation of any part of 51-55 Homebush Road, Strathfield to cease until such time as a valid Occupation Certificate is issued by a principal certifying authority. 4. The First Respondent must not cause, permit or allow occupation of any part of 51-55 Homebush Road, Strathfield, to be occupied until such time as a valid Occupation Certificate is issued by a principal certifying authority. 5. That the First Respondent, Second Respondent and Third Respondent are jointly and severally responsible for the payment of the Applicant's costs as agreed or assessed. 6. Any other Order that this Honourable court sees fit to make in the circumstances.
The APOC not only added the residents (as at 20 November 2017) as respondents (par 4A), it also amended the particulars of its claim that the IOC breaches the EPA Act, and, so, is invalid (par 9). (See amended particulars quoted in [19] below, with emphasis as in original):
A few days later, the (expedited) substantive hearing was set down for 27-28 February 2018.
The two corporate respondents filed Points of Defence ("POD") on 18 January 2018, which relevantly plead: As to the Applicant's [Amended] Points of Claim dated 22 November 2017, the First and Second Respondents objects to the amendments to paragraph 9 and subject to that objection the First and Second Respondent says as follows: 1 The proceedings are an abuse of process and unnecessary because the orders sought would be made otiose by the issue of an Interim Occupation Certificate excising those aspects of the development (if any) held to be inconsistent with DA 2014/103 and Construction Certificates No. C2015108 and C2015108 (sic ??). 2 In any event, the proceedings should follow, pursuant to Section 124 of the [EPA Act], the resolution of the Class 1 proceedings 273815 of 2017 as the determination of the Class 1 proceedings will inform the Court particularly as to the exercise of its discretion and the form and timing of any orders. ... 4 The First and Second Respondent does not admit paragraph 7 but says that the that the (sic) First Respondent had the benefit and protection of the Construction Certificates issued by the then Private Certifying Authority which were to be read in conjunction with and form part of development consent DA 2014/103, pursuant to Section 80 (12) of the [EPA Act]. 5 The Second Respondent does not admit paragraph 8 but says that the Second Respondent had the benefit and protection of the Construction Certificates issued by the then Private Certifying Authority which were to be read in conjunction with and form part of development consent DA 2014/103, pursuant to Section 80 (12) of the [EPA Act]. 6 The First and Second Respondent deny paragraphs 9 and 10. ...
In respect of pars 4, 5 and 6 of those POD, I note that pars 7 to 10 of the APOC plead as follows: 7. The First Respondent has breached section 76A of the [EPA Act]; Particulars (a) At all relevant times the First Respondent had the benefit of the development consent given in relation to DA2014/103; (b) At all relevant times the First Respondent directed or had the ability to direct the Second Respondent in undertaking building works on the land; (c) Building works on the land were not carried out in accordance with the conditions of development consent given to DA2014/103.) 8. The Second Respondent has breached section 76A of the [EPA Act]: Particulars (a) At all relevant times the Second Respondent acted under the development consent given to DA2014/103; (b) The Second Respondent has undertaken building works on the land otherwise than in accordance with the development consent and the instrument, specifically the following plans or documents referred to in condition 1 of Part B - "Operational Conditions" ... (the ten "plans" listed in the amended summons were then repeated - see [15] above) 9. The Third Respondent has issued Occupation Certificate 17/0210-01 ("the OC") in breach of the Act and the OC is therefore invalid: Particulars (a) The OC was issued in circumstances whereby the design and construction of the development does not accord with or is inconsistent with the approved development plans or Construction Certificate plans submitted to the Applicant in support of the issuing of a construction certificate; (b) The Third Respondent should not have issued the OC in circumstances where the works undertaken on the land did not comply with the approved development plans or the plans that were submitted for the issuing of a constriction (sic) certificate; or (c) The Third Respondent could not reasonably have held the opinion that the design and construction of the building accorded with, or was consistent with, the approved development plans or Construction Certificate plans. Relief sought 10. The Applicant seeks the following relief: (Here the relief claimed in the Amended Summons, and quoted in [15] above, was repeated.)
It is to be noted that the POD do not include a prayer for relief to be declined on discretionary grounds.

Respondents

I have described above (at [5]-[9]) the roles and involvement of the first and second respondents (i.e. the corporate respondents), and their spokesperson, in the subject matter of these proceedings.
In my November interlocutory judgment, I noted (at [2]) that the third respondent, PCA Stanly Spyrou, had not at that stage appeared in the matter.
He has now done so (by Notice of Appointment of solicitor filed 23 February 2018), but he has filed no POD, no submitting appearance, and no evidence.
He was represented at the February hearing by Mr D Currie of counsel, who said he appeared in order to "assist the court where necessary", and to "protect any rights or position of the third respondent" (T27.02.18, p1, LL38-44).
In the end, Mr Currie merely adopted, on behalf of the PCA, the submissions Mr Doyle made on behalf of the two corporate respondents (T28.2.18, p41, LL1-6).
Of the 39 residents joined in the proceedings (as the fourth to 42nd respondents), following the November judgment (pars [14] and [15]), only the 9th respondent, Jamie Heffernan (a female listed in the amended summons as "Jamie Hefferan", and as residing at unit 8 of the subject development), has filed any response, namely an appearance and a defence, filed in Court on 27 February 2018, on her behalf, by Mr Doyle.
Heffernan's defence pleads: 1 The Ninth Respondent admits paragraph 4A in that she is an occupant of the building at 51-55 Homebush Rd, Strathfield as at 20 November 2017 and does not admit paragraphs 1 to 7 as they are not pleaded against her. 2 The pleading discloses no cause of action or basis for relief against the Ninth Respondent. 3 The Ninth Respondent is not in breach of the [EPA Act]. 4. The Land and Environment Court lacks jurisdiction to make orders against persons who are not themselves in breach of the Act or who, unless restrained, would be in breach of the Act under the principle set out in Hillpalm Pty Ltd v Heaven's Door Pty Ltd [2004] HCA 59 at [47].
The applicant Council seeks no relief against any of the residents, including Heffernan. It does not contend that any tenants have acted in breach of the EPA Act, and its case focuses only upon the three original respondents.

Related Class 1 proceedings

Two related Class 1 proceedings were, at the time of the interlocutory hearing, and are still, also progressing through the Court, together.
One is an appeal against Council's refusal of a modification application apparently seeking to rectify work which the Council claims in these proceedings is contrary to not only the relevant Development Consent ("DC") plans, but also the relevant Construction Certificate ("CC") plans. Both sets of plans are before me (as Exhibits A1 and A2, respectively).
The other Class 1 matter is an appeal against an order made pursuant to s 121B of the EPA Act.
Both are presently listed for hearing on 25 and 27 July 2018.

Adjournment application

On 19 February 2018, Moore J heard and dismissed ([2018] NSWLEC 17) a motion by the corporate respondents to have the February hearing of these Class 4 proceedings adjourned until after the two Class 1 proceedings had been dealt with. (Both Class 1 matters had also been listed before His Honour (see [2] and [6]), but they are not presently before me.)
His Honour relevantly noted (at [19]) that Council evidence before him indicated that the subject unauthorized works "remain in place, unaltered". (Evidence to similar effect was presented to me in the latest hearing.)

The Evidence before the Court

Both sides of these proceedings relied on three volumes of documents contained in a Court Book ("CB") prepared by the two corporate respondents.
The Council's documents - and its affidavit evidence - are replete with detailed references to various objectives and provisions of the EPA Act and especially the LEP and Council's Development Control Plan said to be offended by the development as executed.
For example, the relevant s 121B order presently under appeal specifies, inter alia: 4. The unauthorised works results in a total FSR of 1.53:1 (1,294.9m²) which exceeds the maximum 0.50:1 (1,222.5m2) FSR permitted for the site. The unauthorised works therefore fails to satisfy the objectives of Clause 4.4(a), (b), (c) and (d) of the Strathfield Local Environmental Plan 2012 which seek to provide consistency in the bulk and scale of new dwellings in residential areas, to minimise the impact of development on heritage items and the amenity of adjoining properties. 5. The unauthorised works fails to satisfy the character test requirement under Clause 30A of the ARHSEPP which requires the proposed development to achieve harmony with the buildings. This is a consequence of the significant loss of deep soil landscaping, loss in physical building separation between development and a loss of both acoustic and aural amenity for adjoining residents (Section 79C(a)(i) of the Environmental Planning and Assessment Act 1979) 6. The unauthorised works fail to satisfy the objectives of Clause 1.2(2) (a) of the Strathfield Local Environmental Plan 2012 which seeks to ensure high quality built form by ensuring that new development exhibits design excellence and reflects the existing or desired future character of particular localities and neighbourhoods in Strathfield. The unauthorised works results in unnecessary bulk added by the construction of additional blade walls and the enclosure of balconies which is contrary to the existing and desired future character of the low density residential locality. (Section 79C(a)(i) of the Environmental Planning and Assessment Act 1979) 7. The unauthorised works fails to satisfy the objectives of Clause 1.2 (2) (f) and provisions under Clause 5.10 of the Strathfield Local Environmental Plan 2012 which requires heritage items including associated fabric, settings and views to be conserved. The unauthorised works results in additional bulk provided to the side elevations of the new redevelopment, unsympathetic modifications made to the adjoining single storey addition required to be demolished, as well as a significant loss of deep soil landscaping which imposes upon the curtilage of the existing heritage item I147. This is not compatible with the character, streetscape and architectural elements of the heritage item nor the Homebush Road Conservation Area (Section 79C(a)(i) of the Environmental Planning and Assessment Act 1979) 8. The newly constructed unauthorised balconies are undersized, receive poor solar access and result In poor amenity to future residents (Section 79C(a)(i) of the Environmental Planning and Assessment Act 1979) 9. The newly constructed unauthorised raised courtyard and conversion of the two (2) roof top areas to open space areas and its close proximity to habitable rooms of units and neighbouring residents will result in adverse privacy and acoustic impacts resulting in poor residential amenity for both northern adjoining neighbours and future residents on the site (Section 79C(b) of the Environmental Planning and Assessment Act 1979).
The Council relied on written and oral evidence from three of its officers - Matthew Dunn, Roberto Giglio, and Louise Mansfield. Dunn and Giglio are compliance officers, and Mansfield a senior planner, who provided an expert report. All their evidence post-dated the interlocutory judgment.
Council also tendered large copies of both the DC plans (Exhibit A1) and the CC plans (Exhibit A2). I accept Council's submission that they are "materially identical".
Council also tendered (in Exhibit A3) some amended annexures to Mansfield's expert planning report (including her CV, letter of engagement, some plans and photographs).
The corporate respondents did not avail themselves of the leave granted to them to rely on their own expert town planning evidence ([12] above), despite having done so at the interlocutory stage (Mr Kennan).
They contested the applicant's expert planning evidence only by cross examining Mansfield, and tendered some documents put to her during cross examination (Exhibit R1 - see T27.2.18, pp61-65).
They relied at the recent hearing on three affidavits sworn by Angela Cai. Two of them (27 October 2017 and 15 November 2017) had been read also at the interlocutory injunction hearing, and White and Doyle agreed to be bound at this hearing by my rulings at that hearing regarding them. Her third affidavit was sworn on 15 December 2017. She was not required for cross examination at either hearing.
Mr Doyle called no other evidence, including none to dispute the nominated differences between the approved plans and the development as built. Nor is there any evidence from the respondents to support any building or engineering need for the features they added to the development as approved, or to quantify the likely cost of their compliance with the relief sought by Council.
However, he insisted that the Council be "put to strict proof" of every element of its case. He even made the following submission (T28.2.18, p31, LL40-42): "... a very serious situation and a very serious order is sought, and commensurate with the Wednesbury principles you should expect it to be proved close to beyond reasonable doubt." (See also p33, L30: "there is a very high bar at the end". As to "Wednesbury" issues, see [87]-[90] below)

The Issues

As I have already noted, the two corporate respondents have complained throughout this case that the Council has been "unduly oppressive" towards them, and Cai personally, and that its stance regarding the project is "grossly disproportionate" to any "breaches" which may have occurred.
They submit that Council and the Court must exhibit a "sensible degree of tolerance" when a developer departs from approved plans; minor mistakes/adjustments are inevitable in the execution of "complex and difficult development" (T27.2.18, p11, LL33-50), and any concerns can and would be easily addressed through the s 96 process. (See [55] below.)
On the other hand, Council has a list of serious complaints based upon demonstrable departures from the court-approved consent, and asserts (Tp18, LL43-47) that there have been "flagrant" breaches committed in full knowledge of Council's adamant opposition to some features common to the original proposal and the project as built.
Council has identified four questions for the Court to answer: (a) has the Council proved that the development has not been built in accordance with the approved plans? (b) if so, has the Council proved that there has been a breach of the EP & A Act by the first 2 Respondents, being the owner and the builder respectively? (c) Should the Occupation Certificate granted by the 3rd Respondent be quashed? (d) What relief should the Court grant under s 124 of the Act?
Although Doyle put Council to strict proof of all aspects of its case, little was put forward in favour of the respondents on issues (a) and (b). The focus of their case has been on defending the occupation certificate.
The elements of the boarding house development, as built, which are said by Council to depart from the plans are: 1. the addition of balconies to units 103-106, 108-110, and 201-207; 2. the addition of blade/nib walls on all elevations; 3. a raised hardstand courtyard built east of the building, where landscaping was approved without hardstand; 4. duplication of the driveway to create a horseshoe; 5. trafficable rooftop areas accessible on Levels 1 and 2; 6. significant reduction/lack of deep-soil landscaping, and removal of landscaped areas around the peripheries of the site and at the front setback to Oxford Road; 7. addition of a covered stairwell in the wrong location on the western elevation, and retention of an existing stairwell to the eastern façade of the heritage building; and 8. absence of windows approved for two ground floor units (G01 and G02), as a result of the raised courtyard (T27.2.18, p56, LL41-49).
These alleged breaches are said to add unacceptably to the bulk and scale of the building.
They are also said to create a "sense of enclosure" about it, despite Council's acknowledgment of some attempts to protect the privacy of the neighbouring school and neighbouring residents (T27.2.18, p9, LL41-48).
Also, as is clear from the photographic evidence, some of them generally encroach upon the appropriate curtilage of the heritage item, and reduce the appropriate separation of the development from its site boundaries and neighbouring developments.
Doyle submitted (T28.2.18, p40, LL1-7, and LL29-47): "... these concerns can be quickly addressed. We say that the balconies and the nib walls are not interfering with anyone. The screens on them can be adjusted, the screens on the front of the building which were acceptable to the expert. We say that the double drive can be easily adjusted if your Honour requires it. The elevated courtyard can't be lowered, your Honour, without enormous expense because it's the top of a car park but it could be landscaped or the brick walls removed. ... But where there are screens, where there are balconies and there's simply more of them than was permitted we say that's a s 96 modification. It doesn't give anyone any concern. Nib walls, obviously the nib wall occupies the space it occupies but it's as much a benefit as it is a disbenefit and one would take that into account were your Honour minded to rectify. We say on all those aspects and even on the vague aspect of curtilage intrusion and the lack of a deep tree somewhere that your Honour would simply let the parties have the benefit of your reasons and let them then come forward with orders as to the appropriate course to take. We think that's more effective but to the extent that your Honour is assisted by submissions from us on that point we say that the minimal amount of adjustment to these things should be done if you were minded to rectify if you find that this matter has been pleaded, particularised and evidenced appropriately. Of course, your Honour, we would seek, while not rerunning any argument that we've run and not attracted the Court to, that there be some sensible suspension of various orders pending on various things depending on your reasons. ...
The Council's objections remain, following the hearing - unapproved works, excessive bulk, mass and scale (FSR), loss of building separation, loss of view corridors, loss of curtilage to the heritage item, loss of half the planned deep soil landscaping, creation of sense of enclosure, etc.
Council acknowledged the value of some of the respondents' "additions", such as louvred privacy screens, and perhaps improved safety on the stairways (T27.2.18, p21, L35 to p22, L23). However; Mr White noted that "in perhaps reducing one planning conflict an entirely new planning conflict has been created" (T28.2.18, p17. LL24-34).
The evidence suggested also that Council may be prepared to accept the horseshoe driveway (Item (d) above - see T27.2.18, p60, LL42-44 and T28.2.18, p46, LL21-28).

The Court Act

Section 20 of the Land and Environment Court Act 1979 ("the Court Act") relevantly provides: (1) The Court has jurisdiction (referred to in this Act as "Class 4" of its jurisdiction) to hear and dispose of the following: ... (c) proceedings under section 123 of the Environmental Planning and Assessment Act 1979 ...

The EPA Act

The EPA Act relevantly includes the following sections to which reference was made (pre March 2018 numbering): 76A Development that needs consent (1) General If an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry the development out on land to which the provision applies unless: (a) such a consent has been obtained and is in force, and (b) the development is carried out in accordance with the consent and the instrument. (2) For the purposes of subsection (1), development consent may be obtained: (a) by the making of a determination by a consent authority to grant development consent, or ... ... 80 Determination ... (12) Effect of issuing construction certificate If a consent authority or an accredited certifier issues a construction certificate, the construction certificate and any approved plans and specifications issued with respect to that construction certificate, together with any variations to the construction certificate or plans and specifications that are effected in accordance with this Act or the regulations, are taken to form part of the relevant development consent (other than for the purposes of section 96). ... 109C Part 4A certificates (1) ... (b) a construction certificate, being a certificate to the effect that work completed in accordance with specified plans and specifications will comply with the requirements of the regulations referred to in section 81A (5), (c) an occupation certificate, being a certificate that authorises: (i) the occupation and use of a new building, or (ii) a change of building use for an existing building, ... (2) An occupation certificate: (a) may be an interim certificate or a final certificate, and (b) may be issued for the whole or any part of a building. ... 109D Certifying authorities (1) Subject to subsections (2) and (3), the following kinds of Part 4A certificate may be issued by the following kinds of persons: (a) a compliance certificate may be issued by: (i) a consent authority, the council or an accredited certifier, or (ii) a person of a class prescribed by the regulations as being authorised to issue a compliance certificate in relation to the matters to be certified, (b) a construction certificate may be issued by a consent authority, the council or an accredited certifier, (c) an occupation certificate may be issued by a consent authority, the council or an accredited certifier, ... (2) An occupation certificate must not be issued to authorise a person to commence occupation or use of a new building except by the principal certifying authority appointed for the erection of the building. ... (4) In this section: new building includes an altered portion of, or an extension to, an existing building. ... 109H Restrictions on issue of occupation certificates (1) There are two kinds of occupation certificates, as follows: (a) an interim occupation certificate that authorises a person to commence occupation or use of a partially completed new building, or to commence a new use of part of a building resulting from a change of building use for an existing building, (b) a final occupation certificate that authorises a person to commence occupation or use of a new building, or to commence a new use of a building resulting from a change of building use for an existing building. It is not necessary for an interim occupation certificate to be issued before a final occupation certificate is issued with respect to the same building. (2) An occupation certificate must not be issued unless any preconditions to the issue of the certificate that are specified in a development consent ... that, by its terms, are required to be complied with before such a certificate is issued, have been met. (3) An interim occupation certificate must not be issued to authorise a person to commence to occupy or use a partially completed new building unless: (a) a development consent or complying development certificate is in force with respect to the building, and (b) in the case of a building erected pursuant to a development consent but not a complying development certificate, a construction certificate has been issued with respect to the plans and specifications for the building, and (c) the partially completed building is suitable for occupation or use in accordance with its classification under the Building Code of Australia, and (d) such other requirements as are required by the regulations to be complied with before such a certificate may be issued have been complied with. ... (5) A final occupation certificate must not be issued to authorise a person to commence occupation or use of a new building unless: (a) a development consent or complying development certificate is in force with respect to the building, and (b) in the case of a building erected pursuant to a development consent but not a complying development certificate, a construction certificate has been issued with respect to the plans and specifications for the building, and (c) the building is suitable for occupation or use in accordance with its classification under the Building Code of Australia, and (d) such other matters as are required by the regulations to be complied with before such a certificate may be issued have been complied with. ... 109M Occupation and use of new building requires occupation certificate (1) A person must not commence occupation or use of the whole or any part of a new building (within the meaning of section 109H) unless an occupation certificate has been issued in relation to the building or part. (2) This section does not apply to: (a) the occupation or use of a new building for any purpose if the erection of the building is or forms part of exempt development or development that does not otherwise require development consent, or (b) the occupation or use of a new building at any time after the expiration of 12 months after the date on which the building was first occupied or used, or (c) the occupation or use of a new building by such persons or in such circumstances as may be prescribed by the regulations, or (d) the occupation or use of a new building that has been erected by or on behalf of the Crown or by or on behalf of a prescribed person. ...
Section 121B of the EPA Act empowers a consent authority, such as the Council in the present case, to give an order "to do or to refrain from doing" a range of "things" specified in an attached Table, in circumstances specified in that table. The relevant order in the present matter was issued pursuant to item 15, which directs a recipient "to comply with a [DC]" which "is not being complied with", and can be issued to the "person entitled to act on the [DC]", or a "person acting otherwise than in compliance with" it.
Also of particular relevance to the present proceedings, as such, are the following further sections of the EPA Act: 122 Definitions In this Division: (a) a reference to a breach of this Act is a reference to: (i) a contravention of or failure to comply with this Act, and (ii) a threatened or an apprehended contravention of or a threatened or apprehended failure to comply with this Act, and (b) a reference to this Act includes a reference to the following: (i) the regulations, (ii) an environmental planning instrument, (iii) a consent granted under this Act, including a condition subject to which a consent is granted, (iv) a complying development certificate, including a condition subject to which a complying development certificate is granted, (v) an order under Division 2A, (vi) a planning agreement referred to in section 93F. ... 123 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. (2) Proceedings under this section may be brought by a person on his or her own behalf or on behalf of himself or herself and on behalf of other persons (with their consent), or a body corporate or unincorporated (with the consent of its committee or other controlling or governing body), having like or common interests in those proceedings. (3) Any person on whose behalf proceedings are brought is entitled to contribute to or provide for the payment of the legal costs and expenses incurred by the person bringing the proceedings. ... 124 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. (3) Where a breach of this Act would not have been committed but for the failure to obtain a consent under Part 4, the Court, upon application being made by the defendant, may: (a) adjourn the proceedings to enable a development application to be made under Part 4 to obtain that consent, and (b) in its discretion, by interlocutory order, restrain the continuance of the commission of the breach while the proceedings are adjourned. (4) The functions of the Court under this Division are in addition to and not in derogation from any other functions of the Court. ...

The Regulation

The Environmental Planning and Assessment Regulation 2000 ("the Regulation") relevantly includes cl 154, which refers to s 109H of the EPA Act, and provides as follows: 154 Health, safety, compliance with development consent and other issues: section 109H ... (1) For the purposes of section 109H (3) (d) and (4) (c) of the Act, an interim occupation certificate authorising a person: (a) to commence occupation or use of a partially completed new building, or (b) to commence a change of building for use for part of an existing building, must not be issued unless the building will not constitute a hazard to the health or safety of the occupants of the building. (1A) For the purposes of section 109H (5) (d) of the Act, a final occupation certificate authorising a person to commence occupation or use of a temporary structure as an entertainment venue must not be issued unless: (a) the certifying authority has inspected the temporary structure, and (b) the temporary structure is suitable for its proposed use as an entertainment venue, including for the number of persons proposed to occupy or use the temporary structure. (1B) An occupation certificate authorising a person to commence occupation or use of a new building, or a partially completed new building, must not be issued unless the design and construction of the new building, or any part of the new building that is completed, are not inconsistent with the development consent in force with respect to the new building. This subclause applies only if the development consent (excluding any construction certificate forming part of the consent) was issued on or after 1 March 2013. Note. A complying development certificate is a form of development consent. ...

The SEPP

The State Environment Planning Policy (Affordable Rental Housing) 2009 ("the ARH SEPP") includes the following clauses: 1. 29 which provides for "standards that cannot be used to refuse consent", including floor space ratio, landscaped area, and building height. 2. 30A which provides: Character of local area A consent authority must not consent to development to which this Division applies unless it has taken into consideration whether the design of the development is compatible with the character of the local area.

The Strathfield LEP

The LEP has a comprehensive section (5.10) dealing with heritage conservation, its objectives, its assessment, its management, and the requirements for and the granting of development consent.
The "particular aims" of the LEP are set out (1.2(2)) in these terms: (a) to achieve high quality urban form by ensuring that new development exhibits design excellence and reflects the existing or desired future character of particular localities and neighbourhoods in Strathfield, (b) to promote the efficient and spatially appropriate use of land, the sustainable revitalisation of centres, the improved integration of transport and land use, and an appropriate mix of uses by regulating land use and development, (c) to promote land uses that provide a wide range of employment, recreation, retail, cultural, service, educational and other facilities for the local community, (d) to provide opportunities for economic growth that will enhance the local community, (e) to promote future development that integrates land use and transport planning, encourages public transport use, and reduces the traffic and environmental impacts of private vehicle use, (f) to identify and protect environmental and cultural heritage, (g) to promote opportunities for social, cultural and community activities, (h) to minimise risk to the community by identifying land subject to flooding and restricting incompatible development.
Clause 4.4 of the LEP deals with FSR, and its objectives include: (a) to ensure that dwellings are in keeping with the built form character of the local area, (b) to provide consistency in the bulk and scale of new dwellings in residential areas, (c) to minimise the impact of new development on the amenity of adjoining properties, (d) to minimise the impact of development on heritage conservation areas and heritage items, ...

Consideration

At the outset, it is appropriate to dismiss out-of-hand the submissions made by Doyle (i) that this Court lacks jurisdiction to deal with these proceedings, and/or (ii) that relief should be denied because of some obtuse argument about Council's pleadings, and/or (iii) that the Council bears an onus higher than on the balance of probabilities.
The respondents are bound by the way their case was conducted, but several of their submissions rest upon an erroneous interpretation, and/or application, of relevant authority, e.g. the High Court decision in Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4, the Full Federal Court decision in Betfair Pty Limited v Racing New South Wales (2010) 189 FCR 356; [2010] FCAFC 133, and the Court of Appeal decision in Burwood Council v Ralan Burwood Pty Ltd (No 3) ("Ralan") (2014) 206 LGERA 40; [2014] NSWCA 404.
The pleading point lacks substance, the onus point is plainly wrong, and jurisdictional "queries" are completely answered by reference to s 123 of the EPA Act and s 20(1)(c) of the Court Act, set out above.
I turn, therefore, to consider what has transpired with this development, and what this Court should now do about it.

Chronology of Events

The history of conflict among the active parties to this litigation (Council and the corporate respondents) can be gleaned from the several chronologies before the Court (including that which I put in my first judgment (at [18])).
I now set out a more detailed chronology, drawing on all the material now before me, including the chronologies provided by both sides at the time of closing submissions: November 2013 Subject property purchased on behalf of interests associated with Cilin Cai (subsequently transferred to C & C). 11 July 2014 DA submitted in a form including balconies and a roof terrace. 16 December 2014 DA refused on grounds that included the detrimental effects of the terrace and balconies. 2 July 2015 DC granted by Brown C, on a deferred commencement basis, and on amended plans which excluded balconies and the roof terrace (CB 2-19 to 2-44). 10 December 2015 The deferred commencement Consent issued by Council. 18 January 2016 CC "approved" by the then PCA, Alex Mullin (CB 2-121 to 2-129. 1 April 2016 A "cease work" order is issued to the first respondent. 11 April 2016 Cai sent to Mullin a plan adding "nib walls" and balconies to the project, but no modification application was lodged. (Mullin did not reply.) 15 April 2016 Council served an "emergency stop work" order. (WorkCover NSW and a structural engineer were called in by Cai.) 28 April 2016 A further CC issued, approving a "Basement plan". c. July 2016 Rooms rented in the heritage building. c. 14 September 2016 Cai's father fined for the breach involved in accepting tenants. 16 December 2016 PCA Mullin is asked by Council to "audit" the project. 9 January 2017 Mullin replied. 6 March 2017 Council issued to Cai an official warning letter re unauthorized works. c. 30 May 2017 Cai lodged a s 96 modification application, apparently seeking to regularise non-compliances (CB 2-325ff). 3 July 2017 Cai lodged a Building Certificate ("BC") application. 14 July 2017 Council engineer "Ve Jay" attended the site, and discussed with Cai the respondents' plans for the driveway(s). 25 July 2017 Cai made a formal complaint about breaches of Council's Code of Conduct by a now departed Council officer, William Oslan (Council's response issued on 20 September 2017.) 2 August 2017 Council refused the s 96 application on six stated grounds. 29 August to 6 September 2017 Council issues Notices of Intention to issue Orders (including one under s 121B.). 6 September 2017 An inspection by Dunn and Giglio indicated no one in residence, but the existence of unauthorized elements - namely, "blade walls", a hard-stand courtyard, balconies on many rooms, and an enclosed outdoor area (CB 2-95 to 2-121). 8 September 2017 Cai lodged a Class 1 appeal against the refusal of her modification application (matter 17/273815). 11-15 September 2017 Mullin was replaced as PCA by the third respondent (but Council was not notified of that appointment until 22 September 2017). 21 September 2017 Council issued to the first respondent a "Works Permit Inspection Checklist" (CB 3-330). 25 September 2017 Cai sought a meeting with Council. 4 October 2017 Spyrou issued to Cai the IOC (CB 2-364) challenged in these proceedings. 6 October 2017 Grandcity received the relevant s 121B order (CB 2-65 to 2-70). 16 October 2017 A neighbour complained to Council that the premises were occupied. 19-20 October 2017 The present Class 4 proceedings were commenced, and Council sought undertakings from the corporate respondents. 20-27 October 2017 The respondents declined to give undertakings, but sought negotiations. 27 October 2017 Cai lodged a Class 1 appeal against the s 121B order (matter 17/325731). 2 November 2017 Council filed its NOM for interlocutory orders. 6 November 2017 Doyle proposed a mediation of all proceedings. 7 November 2017 Doyle proffered to me in open court three undertakings on behalf of the corporate respondents (see November judgment at [6]). 17 November 2017 Interlocutory relief hearing. Judgment reserved, but some orders and directions made ([11] above). 22 November 2017 Interlocutory relief judgment published, and amended summons and amended points of claim ("APOC") filed and served. 18 January 2018 The corporate respondents filed POD, in response to the APOC, and gave notice they would not call expert evidence at the final hearing (see Orders (9) and (10) in [12] above). 31 January 2018 The corporate respondents field their NOM seeking the adjournment of these proceedings. 2 February 2018 Council filed an "expert" report from Mansfield. 8 February 2018 A 34 conference in the two Class 1 appeals was unsuccessful in resolving them, and was terminated. 19 February 2018 Moore J declined to vacate Class 4 hearing dates. 22 February 2018 The Registrar was advised that, in April 2018, the corporate respondents will seek approval to rely on amended plans. 27-28 February 2018 Hearing of these proceedings. Judgment reserved. 12 April 2018 The two Class 1 appeals were set down for hearing on 25 and 27 July 2018.

Evidence and Submissions

The Council's evidence in this matter was undiminished by the respondents' attacks on its officers and their expertise.
I am satisfied that, although Mansfield is an employee of Council, her opinion evidence had the requisite independence and cogency to be accepted by the Court.
I reject Doyle's submission (T28.2.18, p32, L48, and p36, L10) that I should "exclude" her evidence, or at least "weight it very lightly". She is very familiar with the site and the project, and was very careful and balanced in her fresh assessment of it, and in her evidence generally, which she swore was unaffected by the views of other Council officers.
Given some of the respondents' submissions, regarding Cai's role and the asserted mutual independence of the two corporate respondents, it is interesting to note that, when they changed the PCA on 11-15 September 2017, the relevant form was completed by Cai as the/a "person with the benefit of the" DC, and she gave C & C as her business name and Grandcity as her email address (CB 2-361 to 2-363).
I am satisfied that, through the active involvement of Cai, C & C took a far more active part in the project, than that of a passive owner, and that both corporate respondents are responsible for the execution of the subject development.
On the uncontroverted evidence of the departures from the Court approval, both corporate respondents are in breach of the EPA Act.
The answer to each of issues (a) and (b) of the Council's agenda of issues ([49] above) is, therefore, "yes".
Accordingly, I now turn to the IOC granted by Spyrou.
One of the essential preconditions for a valid IOC is that the building be "not inconsistent" with the relevant consent. Doyle submitted (T28.2.18, p46, LL19-20), as I interpret him, that there is a "very wide gap" between a "difference" and "something not inconsistent".
However, Ralan (at [147]-[148]) held that those words "not inconsistent" must be given their ordinary meaning.
Clearly, on those principles, the design and construction of this boarding house are, indeed, inconsistent with the conditions of the DC.
I note also that, in Ralan, the developer asserted cogent planning and aesthetic reasons for the changes made, but the Court of Appeal said that that was no test of "inconsistency". On the other hand, in the present case, the purpose was to reinstate elements of a rejected proposal, and the respondents say nothing about "improving" the project in planning terms.
Spyrou's IOC fails the "inconsistency" test, and was, therefore, issued beyond power, and in breach of the EPA Act.
For completeness, given the Council's amended summons, I need to examine the question of "reasonableness".
Doyle relied upon Minister for Immigration v Li (2013) 249 CLR 332; [2013] HCA 18, in which several judges, notably Gageler J, discussed the concept of "reasonableness" in what is usually called "the Wednesbury sense" (viz Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223).
I find those discussions totally supportive of Council's case in these proceedings, and not of the respondents'.
Applying Gageler J's remarks, I find that no reasonable PCA in the position of Mr Spyrou could reasonably have disregarded the obvious failures of the development to accord with the approved plans, and so conclude that the requirements of cl 154(1B) of the Regulation had been met: Bankstown City Council v Ramahi (No 2) [2016] NSWLEC 34, at [210] (per Craig J).
The IOC having been found to be invalid, the present occupation of the project is unlawful.
Prima facie, therefore, all the relief sought by the Council in its amended summons ([15] above) ought to be granted.

Should those orders be made in all the circumstances?

The three respondents against which/whom that relief was sought have raised no substantive discretionary grounds upon which that relief should be declined or moderated.
Nonetheless, even though s 124 confers a wide and unfettered discretion on the Court, it should carefully consider and apply, as Pepper J did in Lane Cove Council v Ross (No 14) ("Ross") [2013] NSWLEC 87, the principles so eloquently stated by Kirby P in Warringah Shire Council v Sedevcic ("Sedevcic") (1987) 10 NSWLR 335, at 338-341, as to how that unfettered discretion (Sedevcic, at 340B) should be exercised.
The breaches of the consent in the present case are flagrant. They are far more than "minor" or "technical" (Sedevcic, at 339E). They are very significant indeed.
Criminal proceedings were an option, but Class 4 of this specialist Court's civil jurisdiction provides a useful alternative, especially when Councils seek to remedy, rather than punish (Sedevcic, at 341A-D).
There were complaints about the DA, and also about the "as built" development. Knowing of Council's and neighbourhood concerns about several elements of the initial proposal, the respondents withdrew those elements, secured an approval from the Court and then reinstated them for private advantage, rather than fulfil their public duty to comply (Sedevcic, at 339G, 340A, and 340D/E). Council has a public duty to protect and advance the public interest in orderly development, and protection and use of the environment (Sedevcic, at 339G and 340D/E).
No attempt has been made to justify the departures on, e.g., engineering grounds, nor to moderate them or their significant adverse impacts (Sedevcic, 340A). The fact that some may be thought to have beneficial effects should not preclude the making of appropriate remedial orders (Sedevcic, 339F/G).
The corporate respondents' actions and decisions have been shown to be "calculated" in every respect. They effectively ignored the DC decision of this Court, and maintained their state of conflict with the Council.
They disregarded local government's normal requirements for things such as permits, notices, and traffic plans; and they allowed occupation, even before any OC was issued.
This is certainly not a case of mere "miscommunication" (T28.2.18, p29, L42), involving an "over-zealous" or "overbearing" Council (L47), which has "overreached in the orders it has sought" (p37, L25).

Conclusion

The subject site is significant (a "focal point" in several ways), and the impact of the respondents' works on the environment, including the character of the conservation area, has been shown to be substantial.
The resultant undermining of the EPA Act's development control regime has been found to be deliberate, and very serious.
As Pepper J said in Ross (at [88]), if exceptions are made to compliance with the EPA Act, its orderly enforcement is undermined (Sedevcic, at 340C/D).
Here, as in Ross, no cogent reason has been advanced for the Court to deny Council the relief it seeks.
Cost of rectification - of which there is no evidence - and any resulting inconvenience to the respondents, although possibly significant, are not sufficient reasons to decline relief (Sedevcic, at 340F/G).
The Orders sought in the amended summons generally should and will be made, save that I do not consider it appropriate that the third respondent or ninth respondent be ordered, at least at this stage, to pay the applicant's costs.
The parties and the Registrar will need now to consider the utility, if any, of maintaining the scheduled hearing of the related Class 1 proceedings in late July.

Orders

The Orders of the Court will be: 1. The First Respondent and the Second Respondent are ordered, as from the date of these Orders, to do all things necessary so as to comply with the Development Consent given by the Court in Case 10918 of 2017, in that they must comply with Condition 1 of Part B - Operational Conditions, and specifically the development must be built in accordance with and must comply with the following plans that are referred to in Condition 1 of Part B of the Consent: 1. Basement Plan, Drawing No. A1200, Issue D, prepared by Ghazi AI Ali dated 21 May 2015. 2. Ground Floor Plan, Drawing No. A1201, Issue G, prepared by Ghazi AI Ali dated 21 May 2015. 3. Level 1 Plan, Drawing No. A1202, Issue G, prepared by Ghazi AI Ali dated 21 May2015. 4. Level 2 Plan, Drawing No. A1203, Issue G, prepared by Ghazi AI Ali dated 21 May 2015. 5. Elevations, Drawing No. A1500, Issue F, prepared by Ghazi AI Ali dated 15 May 2015. 6. Elevations, Drawing No. 1501, Issue F, prepared by Ghazi AI Ali dated 15 May 2015. 7. Sections, Drawing No. A1700, Issue E, prepared by Ghazi AI Ali dated 8 May 2015. 8. Roof Plan, Drawing No. A1204, Issue E, prepared by Ghazi AI Ali dated 21 May 2015. 9. Material Finishes Schedule, submitted in accordance with Deferred Commencement Condition 2. 10. Conservation Works Schedule ("Merriwa"), prepared by Graham Brooks and Associates, dated July 2014. 1. The Occupation Certificate 17/0210-01, issued by the Third Respondent Stan Spyrou (BPB1977) and determined on 4 October 2017, is declared to be invalid. 2. The First Respondent must immediately cause occupation of any part of 51-55 Homebush Road, Strathfield to cease until such time as a valid Occupation Certificate is issued by a principal certifying authority. 3. The First Respondent must not cause, permit or allow occupation of any part of 51-55 Homebush Road, Strathfield, until such time as a valid Occupation Certificate is issued by a principal certifying authority. 4. The First Respondent and Second Respondent are to be jointly and severally responsible for the payment of the Applicant's costs, as agreed or assessed. 5. No order as to costs in favour of or against any of the 3rd to 42nd Respondents. 6. The Applicant Council is to have liberty to apply on 72 hours' notice. 7. The Court Book, authorities, and exhibits are returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 May 2018

At a glance

Court

Decision date

Before

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Judgment (21 paragraphs)

Parties

Cases Cited (14)

Cited By (1)