Trustees of the Roman Catholic Church for the Diocese of Maitland-Newcastle v Newcastle City Council

The issues are distilled

1. According to the Respondent, this appeal concerns the proposed demolition of a listed heritage item, absent sufficient justification, or adequate investigation of options for reuse.
2. The parties agree, supported by the concurrence of the experts, that the demolition of the Church would have an irreversible adverse impact on the heritage significance of the heritage item, and will alter the setting of other heritage items nearby.
3. However, the Applicant submits that the demolition is an option of last resort, justified on the advice of its expert structural engineer, Ms Karlie Collis, that the Church is structurally unsound, and on the evidence of its expert quantity surveyor, Mr Steve Madden, that the costs of remediation are an unacceptable burden on the Applicant.
4. In my consideration of the principally contested issues in this matter, I am assisted by Applicant's written submissions in closing (AWS) and by the Respondents' written submissions in closing (RWS).

St Columban's Church is an item of heritage significance

1. St Columban's Church is listed as an item of local heritage significance in Schedule 5 of the NLEP.
2. The Court was assisted by experts in built heritage, including Mr Barney Collins, for the Applicant, and Mr Colin Brady for the Respondent who conferred in the preparation of the joint expert heritage report (Exhibit 5).
3. The following heritage assessments, prepared by the experts, are appended to Exhibit 5:

• Appendix A: Heritage Assessment Report, prepared by EJE Heritage dated April 2020 (Collins' Assessment);
• Appendix B: Review of Application for demolition, prepared by Mr Colin Brady November 2021 (Brady's Assessment).

1. The heritage significance of the Church is described in a statement of significance prepared for the Newcastle City Wide Heritage Study 1996 (Exhibit C, folio 1) as follows: "Demonstrates the growth of the church in Mayfield. Particularly prominent element in the streetscape." Additionally, a physical description of the Church is also included as follows: "Facebrick work building with simple massing and symmetrical façade. Elongated circular arched windows. Low-pitched parapet with central symbol of the cross at the apex. Banded brickwork effect to interior."
2. A Statement of Significance, prepared by EJE Architecture at p 54 of Appendix A to the joint expert report, is in the following terms: "St Columban's Church is significant for its construction coinciding with the outbreak of World War II and completion ready to receive the influx of workshippers in the Post War period. As such it demonstrates the growth of the Catholic Church in Mayfield. It is significant for its design, being a rare and representative ecclesiastical application of the Inter-War Functionalist style and attributed to John P Gannon who, along with his relatives who worked in the same practice, is a significant architect in the Newcastle and Hunter region. It is significant as a landmark element in the Church Street streetscape particularly due to its height and position near the crest of the hill."
3. While the experts dispute the precise authorship of the work, little turns on it. Instead, more substantial differences arise from;

• the level of heritage significance, and
• the viability of adaptive reuse.

Level of heritage significance

1. According to Mr Brady, the classification of the Church as an item of local, and not state, heritage significance results from insufficient assessment of its historical, aesthetic and comparative values.
2. The Church features in architectural guides and texts that are cited in the heritage joint report including:

• Early Architects of the Hunter Region: a hundred years to 1940, by Les Reedman;
• Australian Romanesque: A history of Romanesque-Inspired Architecture in Australia, by John W East.

1. Where Mr Collins considers the design of the Church to be, in essence, a 'one-off' by the architect JP Gannon, Mr Brady believes it represents an important transition in the oeuvre of the architect that continued to evolve in his later work.
2. In the course of their oral evidence, the experts conversed freely on the merits of certain aspects of the design of the Church, its reception in the local community at the time, and the reception of other recognised works of architecture.
3. While Mr Collins considers the design of the Church to be experimental and unique, it is compromised in its design and material selection. In particular, the 'cavalier' specification of blast furnace slag in the concrete is a reason for the accelerated deterioration in the structure.
4. Mr Brady cites Reedman's assessment of the Church as 'remarkable', as a high point of Inter War design and an important influence to other churches including St Anne's Shrine, Bondi and St Mary's, North Sydney.
5. The State Heritage Inventory Report (Exhibit 2, folio 33) records the Assessed Significance and Endorsed Significance as 'Local'.
6. While I note Mr Brady considers there to be grounds for the Church to be classified as an item of state heritage significance, I accept the significance as assessed and endorsed in the State Heritage Inventory Report for three reasons. 1. Firstly, I read Reedman's assessment of the Church on which Mr Brady relies, at p 22 of Brady's Assessment, as a 'complete departure from other Gannon churches'. 2. Secondly, as I understand Brady's Assessment (pp 7-10), St Anne's Shrine, Bondi and St Mary's North Sydney owe more to their architects' interest in influential English architects than to JP Gannon's St Columban's Church. 3. Thirdly, Mr Brady's own view, at p 31 of Brady's Assessment, is that "none of his other designs have the standard of St Columban's in terms of aesthetic qualities."
7. On this basis, I prefer and accept Mr Collins' view that the design is, in essence, a 'one-off' and so does not constitute an important or pivotal work in the life of the architect that may otherwise be deserving of greater level of significance.

The viability of adaptive reuse

1. The Applicant accepts options for reuse are essential to demonstrating grounds for demolition of the Church. At Section 5.7 of Collins' Assessment, Mr Collins describes the potential for reuse of the Church to include:

• A school hall;
• School library;
• A preschool or Outside of School Hours (OOSH) facility;
• Neighbourhood Centre/Community centre;
• Recreation or environmental uses;
• Residential uses;
• Commercial uses;
• Industrial uses;
• Infrastructure uses.

1. The conclusion reached by Mr Collins is that "the Options for reuse typically failed to result in a satisfactory outcome as the impacts were all considered to be too severe to contemplate". (Exhibit 5, Appendix A, p57)
2. The Respondent submits the options for reuse proposed by the Applicant are 'cursory and superficial' (par 7.2, RWS) for the reasons that follow: 1. Firstly, the Applicant's architect, Mr Collins states that reuse did not form part of the brief for the site. 2. Secondly, the options are described in terms of land use, and are not accompanied by sketches, plans or other diagrams. 3. Thirdly, the options are not the subject of costings undertaken by the Applicant's Quantity Surveyor, Mr Steve Madden. 4. Fourthly, other than the heritage significance of the Church, the site is relatively unconstrained. To this end, the land to the north of the Church is a grassed playing field, and is open car park to the south; there is no applicable development standard in respect of the height of buildings or the floor space ratio for the site, or the land to the north and south of the Church; and development for any purpose is permitted on the site under the NLEP, even though it would not otherwise be allowed, so long as the conditions of cl 5.10(10)(a)-(e) are achieved.
3. Instead, the Respondent considers concepts prepared by Mr Brady (Exhibit 4, Annexure C) for three potential uses more appropriate to the Church and its context, with no evidence presented by the Applicant that finance necessary for such reuse is not available.
4. An affidavit sworn by Mr Sean Scanlon on 2 December 2021, CEO of the Diocese of Maitland-Newcastle (Exhibit C, Tab 3), states, in summary: 1. The land, and its curtilage, is owned by the Applicant under the provisions of the Roman Catholic Church Trust Property Act 1936. 2. A bare trust exists between the Parish and the Applicant, and the precise legal status of the relationship is described in the Church Administration Handbook, appended to the affidavit. 3. While the Applicant holds the land and the Church for the benefit of the Parish, the business of the Parish, its priest, finance council, books, records and governance is independent from the Diocese that has no say in the operations or finances of the Parish. 4. As a result of ageing and falling attendance in the Parish, the congregation was redirected to the church of Christ the King, also in Mayfield, after which Parish finances show a deficit. 5. Based on the financial position of the Parish, funding is not available for repairs or adaptive reuse identified by options at [30], and so the Church is likely to remain unused and in a state of disrepair if consent is not granted for its demolition.
5. It is in this context that the Parish voted to demolish the Church.
6. According to Mr Eastman, counsel for the Applicant, as the Church is on land also occupied by the St Columban's School, a not-for-profit educational facility, options for reuse must be understood in the context of the Not-for-Profit Guidelines for Non-Government Schools dated June 2019, published by the NSW Department of Education (the NFP Guidelines).
7. In summary, I understand the NFP Guidelines, and operation of s 83C of the Education Act 1990, constrain reuse of the Church by, in effect, precluding adaptive reuse or redevelopment that returns a profit to the Applicant.
8. Neither of the adjoining schools have need for a Hall, Library or other associated use, the high school having recently constructed a multi-purpose hall, and so options for reuse are likely to require the alienation of land from the school, or in other words, its subdivision and sale.
9. Furthermore, while the Church occupies the lot of land described at [5] along with the St Columban's Primary School, both operate as separate entities with separate financing systems under the terms of the Roman Catholic Church Trust Property Act 1936, (par 38, AWS).

Structural engineering works are required

1. Structural engineering experts, Ms Karlie Collis, for the Applicant, and Mr Eamonn Madden, for the Respondent, conferred in the preparation of a joint expert report on structural engineering, marked Exhibit 3.
2. In their written evidence, the experts are agreed on structural matters. In broad terms, the structural experts agreement is recorded in Figure 1 and Figure 3 of the joint report.
3. Figure 3, re-produced below, depicts what might be described as the structural schema of the Church, comprising continuous concrete footings on which external masonry walls are constructed, and which also connect the perimeter of the central nave, to the external walls of the Church.
4. While not relevant to the circumstances of the case, I note here that the circular baptistry appears on the northern side of the church building in Figure 3. It was, in fact, constructed on the southern side of the church building.
5. During the onsite view, the Court viewed the subfloor area that, according to Ms Colllis, demonstrates spalling concrete and exposed reinforcement to the columns and footings to the perimeter of the central nave. The same is identified in Brady's Assessment (p 37).
6. Figure 1, re-produced below, is described as a repair methodology that proposes a new structural system alongside the existing that would no longer be relied on:
7. The method of rectification and strengthening may be summarised as follows:

• Localised piling adjacent to existing primary columns;
• Tie beams connecting to new piles located either side of the existing concrete footing at 2m centres around the perimeter;
• New concrete blade wall to buttress the existing primary columns to the perimeter of the nave, founded on a pile or pad footing.

1. Notwithstanding the agreement of the experts at [41], differences in their understanding of the structural methodology to be applied to the Church, and the estimates of cost associated with that methodology was the subject of some disagreement that became evident in their oral evidence.
2. At the close of the first days' proceedings, the Court directed the structural experts to confer on a more precise description of the methodology for seismic bracing, scaffolding and propping, and for an agreed means of access to subfloor areas for the purposes of remediating footings.
3. The structural experts were directed to prepare a short supplementary joint report, with sketches or diagrams to assist the quantity surveying (QS) experts to further confer in respect of the provisional cost contingencies in Annexure A of the QS joint expert report at Exhibit 4.
4. A supplementary joint expert report was later marked Exhibit 8 and accompanied by sketches indicating the member size and arrangement of structural steel required to strengthen the existing structure.
5. In response, the Quantity Surveyor experts, Mr David Madden (for the Respondent), and Mr Steven Madden (for the Applicant) agreed, in their oral evidence, that a previous allowance made by Mr Steven Madden of $1,000,000 in earthquake strengthening and other works was more correctly to be priced at $257,000, exclusive of 'on-costs' of 40%.
6. Generally, the Respondent considers allowances made by Mr Steven Madden to be excessive, with an unrealistic level of risk and difficulty assumed that results in an inflated estimate of works required to retain the Church.
7. In summary, Mr Steven Madden calculates the costs of restoration of the Church to total $5,546,262.00, while Mr David Madden calculates the cost at $1,423,649.00 (or $1,600,000 adjusted, for the reasons set out at par 55 in the RWS).
8. According to the Respondent, the difference arises from duplication in costs, the perception of risk and the rates and sums assumed by Mr Steven Madden.
9. In particular, the Respondent cites Items 3, 6-10, 12, 17 and 63 of Annexure A for which allowances are made in respect of items no longer required in the scope of works to be priced and which totals a difference between the experts of $1,028,095.68, exclusive of 'on-costs'.
10. The experts also differ in the rates relied upon to calculate trade costs, summarised as follows: 1. Mr Steven Madden has aggregated cost escalation from each of the years 2017-2021, applied a regional index factor of 1%, and consulted the Rawlinsons Quarterly update, and the Australian Institute of Quantity Surveyors Building Cost Index to determine a total mark up of 17.90% (Annexure A, p 6), which he considers appropriate for the restricted site, and 'piecemeal' nature of the work. 2. Mr David Madden has relied upon Rawlinsons Quarterly Update and the Rawlinsons Regional Index to determine a total mark up of 6.5% which he considers appropriate given the good access that results once demolition is complete, such as the removal of the timber floor to gain access to footings.
11. I note here that Mr David Madden has also provided an estimate of costs, at Annexure D of the joint report, for the options prepared by Mr Brady at [33] that range from $2,041,047 for adaptive reuse for a school hall, to $20,712,505 for a nursing room with 150 rooms.
12. The Applicant submits that the Court does not need to resolve the difference in the estimates, and the burden is not the impediment to greater profit through redevelopment, but is more correctly an assessment of the burden of cost of carrying out the works to make the building safe in a school setting (par 24 AWS).
13. The Respondent submits that in circumstances where the Applicant asserts conservation and reuse options are an unreasonable burden, the financial position of the Applicant should be disclosed with greater transparency.
14. Instead, the Applicant provides only the income and expenditure of the Parish between 2017-2021, with no disclosure of the Applicant's assets and liabilities, or alternative sources of funding.

Consideration

1. As the DA proposes demolition of an item of local heritage significance, the following relevant provisions of cl 5.10 of the NLEP apply: … (1) Objectives The objectives of this clause are as follows - (a) to conserve the environmental heritage of the City of Newcastle, (b) to conserve the heritage significance of heritage items and heritage conservation areas, including associated fabric, settings and views, … (2) Requirement for consent Development consent is required for any of the following - (a) demolishing or moving any of the following or altering the exterior of any of the following (including, in the case of a building, making changes to its detail, fabric, finish or appearance) - (i) a heritage item, … (b) altering a heritage item that is a building by making structural changes to its interior or by making changes to anything inside the item that is specified in Schedule 5 in relation to the item, … (4) Effect of proposed development on heritage significance The consent authority must, before granting consent under this clause in respect of a heritage item or heritage conservation area, consider the effect of the proposed development on the heritage significance of the item or area concerned. This subclause applies regardless of whether a heritage management document is prepared under subclause (5) or a heritage conservation management plan is submitted under subclause (6). … (10) Conservation incentives The consent authority may grant consent to development for any purpose of a building that is a heritage item or of the land on which such a building is erected, or for any purpose on an Aboriginal place of heritage significance, even though development for that purpose would otherwise not be allowed by this Plan, if the consent authority is satisfied that - (a) the conservation of the heritage item or Aboriginal place of heritage significance is facilitated by the granting of consent, and (b) the proposed development is in accordance with a heritage management document that has been approved by the consent authority, and (c) the consent to the proposed development would require that all necessary conservation work identified in the heritage management document is carried out, and (d) the proposed development would not adversely affect the heritage significance of the heritage item, including its setting, or the heritage significance of the Aboriginal place of heritage significance, and (e) the proposed development would not have any significant adverse effect on the amenity of the surrounding area.
2. The Newcastle Development Control Plan 2012 (NDCP) also sets out objectives in Section 5.05.1 to 'encourage the retention of existing heritage items' and 'encourage heritage items to be used for purposes that are appropriate to their heritage significance'.
3. When seeking to weigh the retention and restoration of a heritage item against demolition, the Court has commonly accepted that it is appropriate to adopt the principles set out by Moore C, as he was then, in Helou v Strathfield Municipal Council (2006) 144 LGERA 322; [2006] NSWLEC 66 (Helou) by analogy (see Norm Fletcher & Associates Pty Ltd v Strathfield Municipal Council [2013] NSWLEC 1118; Nader v Strathfield Council [2015] NSWLEC 1370 (Nader); Xu v City of Sydney [2018] NSWLEC 1332; 777 Trading Pty Ltd v City of Sydney [2019] NSWLEC 1619).
4. The principles set out in Helou are: "1. What is the heritage significance of the conservation area? 2. What contribution does the individual building make to the significance of the conservation area? The starting point for these questions is the Statement of Significance of the conservation area. This may be in the relevant LEP or in the heritage study that led to its designation. If the contributory value of the building is not evident from these sources, expert opinion should be sought. 3. Is the building structurally unsafe? Although lack of structural safety will give weight to permitting demolition, there is still a need to consider the extent of the contribution the building makes to the heritage significance of the conservation area. 4. If the building is or can be rendered structurally safe, is there any scope for extending or altering it to achieve the development aspirations of the applicant in a way that would have a lesser effect on the integrity of the conservation area than demolition? If the answer is yes, the cost of the necessary remediation/rectification works should be considered. 5. Are these costs so high that they impose an unacceptable burden on the owner of the building? Is the cost of altering or extending or incorporating the contributory building into a development of the site (that is within the reasonable expectations for the use of the site under the applicable statutes and controls) so unreasonable that demolition should be permitted? If these costs are reasonable, then remediation/rectification (whether accompanied by alteration and/or extension or not) should be preferred to demolition and rebuilding. 6. Is the replacement of such quality that it will fit into the conservation area? If the replacement does not fit, the building should be retained until a proposal of suitable quality is approved."
5. In the circumstances of this case, as the site is not located within a heritage conservation area, and the Applicant does not propose replacement of the Church with another building, questions 1 and 6 are not applicable.
6. That said, as stated at [27], the heritage significance of the item is recorded in the State Heritage Register and the Statement of Significance, prepared by EJE Architecture at [19] is, in my view, helpful in understanding the heritage significance of the Church in its geographical and architectural context.
7. Relevantly, in Nader, the Commissioner accepted, as I do here, that while it is appropriate to weigh the additional financial impost on the owner against the public benefit of retaining and reconstructing a heritage item, such an exercise has to be compared to an alternative, such as demolition of the existing and construction of a new building, to ascertain the true cost.
8. In this case, as there is no replacement building proposed, that exercise is not able to be undertaken. Likewise, the QS experts do not provide a cost on demolition. The only indication of such a cost is a sum of $150,000 entered on the DA Form (Exhibit A, Tab 1).
9. The structural experts agree the building in its current state is structurally unsafe. They are also agreed on works that would render the structure safe.
10. On the basis of the QS experts, the cost of those works is said to be somewhere between $1,600,000 and $5,546,262.00.
11. For the reasons that follow, I am unable to conclude that the costs impose an unacceptable burden on the owner of the building: 1. Firstly, for the reasons advanced by the Respondent at [55]-[55], I agree and accept that the estimate prepared by Mr Steven Madden, on behalf of the Applicant, exceeds the scope of works agreed by the structural experts as being necessary. The estimate is excessive. 2. Secondly, in considering potential options for reuse that might achieve the development aspirations of the Applicant, three things can be said: 1. Beyond the removal of the building, and absent a brief from the Applicant for reuse, the development aspirations of the Applicant appear to comprise the installation of turf and a concrete path in place of the Church (Drawing A07, Exhibit A, Tab 3). 2. To the extent that Mr Collins engaged in an assessment of alternative uses at [30], his conclusions appear to be either oddly definitive, given they are unsupported by sketches that genuinely seek to explore options, or alternatively they may be described as 'left field', such as use of the land for a bus depot or an electricity substation. 3. By comparison, Mr Brady's sketches at Annexure C of Exhibit 4, while conceptual, assist in understanding the degree of alteration that may flow from potential reuses, and which may or may not be acceptable in terms of heritage impact, but which are not proposed by the Applicant, and so are not factored in the estimates prepared by Mr Steven Madden. 1. Thirdly, whether or not the Parish voted to support the demolition of the Church building, the Parish is not the owner of the building nor, incidentally, of Lot 4 in DP 509134 to the north on which demolition would also occur. The assessment generally undertaken by the Court seeks to understand the scale of the burden on the owner of the building. As the owner of the building, and the land on which the building stands, it is the Applicant's financial position that is pertinent to the Court's consideration, and not that of the Parish, whose members have been redirected, presumably by the Applicant, to another church building. 2. Such a conclusion is supported by the Applicant's own submissions at [36]-[37], which is in effect, that a profit resulting from the redevelopment of the Church site would return to the Applicant, who has ownership of the site, and of the adjoining school that shares the lot of land on which the church stands, and would not return to the Parish. 3. Relatedly, just as the Parish is said to be unable to fund the costs to render the Church structurally safe, it may also be taken from Mr Scanlon's evidence at [34], that the Parish is also without the means to fund that for which the Applicant now seeks consent, which is the demolition of the building at a cost of $150,000.
12. In the circumstances of this case, the Church requires structural rectification works, agreed by the relevant experts, to make it safe into the future. The scale of the Church is significant and so it is not unsurprising that the cost of the rectification is in the ballpark of that range at [70].
13. Whether that range of costs is an unacceptable or unreasonable burden on the Applicant cannot be ascertained on the basis of the evidence before the Court.
14. What can be said is that the Church is not isolated on a lot of land surrounded by properties under the ownership of others that would constrain its reuse. It has been in the continuous ownership of the Applicant since first constructed and is part of a large school campus. It would appear that the future of the Church, whatever that may be, is or perhaps should be, considered in conjunction with the two schools that comprise the campus.
15. To do otherwise, as appears to have been the case prior to now, would appear a failure of strategic foresight and basic master planning.

Orders

1. The Court orders that: 1. The appeal is dismissed 2. Development consent for Development Application DA 2020/959, for the demolition of an existing Place of Public Worship (St Columban's Church) at 39 Church Street, Mayfield, is refused. 3. All Exhibits are returned, except for Exhibit A.

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