Domachuk
51In Domachuk , Stein J was faced with the definition of " rural industry " as " handling, treating, processing or packing of primary products " , in the absence of a definition of " primary products " . Again, in this matter, argument returned to the definition in the Factories, Shops and Industries Act.
52The Council refused development consent for several uses on the basis that they did not fit the definition. The headnote records (at 395):
These uses included the growing of mushrooms on a small scale, the bagging of spent mushroom compost for sale, the mixing of numerous imported products with the spent compost to produce various bagged potting mixes for sale, and the sale of imported products such as peat moss, charcoal, leaf mould, pine bark and cow and poultry manure in their imported states .
53Stein J referred to an earlier decision he had made concerning the identical definition of " rural industry " ( Penrith City Council v HBH Manufacturing Pty Ltd (unreported, 5 June 1992)), but he was not taken to, or at least did not refer to, Bignold J's decision in ANL .
54In outlining the uses on the land, Stein J said (at 396):
The growing of mushrooms has continued since 1972. The bagging of spent mushroom compost for sale has been occurring since around 1975. The importing of numerous products to mix with the spent compost to produce various bagged potting mixes has also probably been going on for a similar period, although the Council has never formally approved of such a use and has attempted to have it cease. Peat moss, in bags, is also from overseas. Some of the peat moss is used in mushroom growing, some is mixed with spent mushroom compost in the potting mixes and some is sold in the same condition as imported.
The individual items produced for sale or brought onto the site are at least 27 in number. A number of them are merely imported to the site and sold without further processing or handling. These include Australian and imported peat moss, charcoal, leaf mould, perlite, pine bark, rice hulls, cotton seed hulls, sphagnum moss, tea tree bark, vermiculite, gypsum, ground limestone, wood chips, and cow and poultry manure. Spent mushroom compost is also bagged and sold without additives.
Most of the manufactured potting mixes are a blend of spent mushroom compost and various other ingredients. These are usefully set out in annexure "A" to the applicant's statement of environmental effects lodged with the development application. They include African violet mix, bonsai mix, bulb fibre, camellia and azalea compost, orchid compost and special free draining potting mix. African violet mix includes 35% spent mushroom compost plus various unstated quantities of rice hulls, peat moss, sand, perlite, charcoal and sawdust. Orchid compost includes 45% mushroom compost mixed with rice hulls, pine bark, peat moss, sawdust and charcoal. Some products contain as little as 35% spent mushroom compost (when made up) and others up to 95% (e.g., seed raising mixture).
55There was no dispute that mushroom growing was an agricultural pursuit, but the Council submitted that the other activities constituted, essentially, a " manufacturing industry ", and were, therefore, prohibited.
56During a departmental investigation the Council advised that it raised no objection to the bagging of garden compost and animal manure, provided that such items had been used for the growing of mushrooms, but the fact remained that the mixing and bagging of the potting mixtures meant the importation of other products to the site, contrary to the Council's stated requirements.
57The evidence suggested that a number of products brought on to the site were used in the growing of mushrooms, but significant quantities of such products were imported for the purpose of being sold without any change in their constitution or their packaging. Also, 20% of the spent mushroom compost was made specifically for sale and not for mushroom growing on the land, and 20% of the stables straw brought onto the land was not used in mushroom growing.
58His Honour concluded that mushroom growing was a small and perhaps declining proportion of the business activity on the site. He rejected an estimate of 23%, preferring evidence that suggested that 10-20% of the income was derived from mushroom growing. He concluded that the principal business on the land was the mixing of various ingredients, including spent mushroom compost, to produce various potting mixes marketed under the brand name Bouquet Composts. In addition, a large part of the activities was the sale from the site of products brought on to the site, including peat moss from overseas.
59His Honour said (at 398):
In my opinion 'primary' connotes being of the first order so, for example, a grain is a primary product. The handling, processing or packing of grain would therefore be a rural industry. Here a large number of products, which are brought onto the site, are claimed to be primary products, for example, rice hulls, peat moss, sawdust, sand, perlite, vermiculite, pine and other bark, wood chips and leaf mould. These come to the site in different containers, some in bags. They are mixed by various processes to manufacture the different types of potting mixes, which are then bagged and labelled for sale .
60His Honour then examined the nature of perlite and vermiculite, and noted (at 398-399 - emphasis mine) that:
... rice hulls are husks removed from the rice grain, that peat is a highly organic soil and peat moss or sphagnum moss is usually extracted from the ground, as is sand. Charcoal, sawdust, pine tree bark and tea tree bark all derive from timber. In the sense that they are derived ex-site (either grown, extracted or felled) and imported to the premises, do they comprise primary products which are handled, processed and packed?
It may first be observed that the products have all been produced off site. They have undergone their primary production or harvesting and, in most cases, have already been handled, processed and packed. For example, the hulls of rice have been separated from the grain and packed. Perlite and vermiculite have been extracted and processed to produce the product brought to the site for mixing. The peat has already been extracted (in Germany, New Zealand and what was the USSR) and no doubt processed, packed and exported to Australia. The timber based products have all been separated, treated and packed before they are delivered to the subject site.
Have they therefore ceased to be primary products and become merely the ingredients in the manufacture of the various potting mixes produced on the premises? In my view this is the correct position and the activities which are occurring on the premises are not a rural industry as defined in the LEP but more in the nature of an industry involving a manufacturing process as defined. The various products imported to the site are undergoing a secondary processing. The bagging of spent mushroom compost, without its mixing with other ingredients, may be argued to be a rural industry since it involves the handling and packing of a primary by- product of the growing of mushrooms on the land. However, once large numbers and quantities of other ingredients are imported to the site in order to mix with the spent compost to produce a variety of products, this cannot be properly classified as a "rural industry". I come to this conclusion having regard to the character, extent and other features of the uses of the land: Foodbarn v Solicitor General (1975) 32 LGRA 157.
61His Honour noted that in the HBH Manufacturing decision he had held that the assembly of wooden crates, boxes and palettes from timber baulks was not a " rural industry ". Rather, His Honour found that those activities were properly characterised as an " industry ", as it was not a processing of " primary products ", but a manufacturing of various products.
62His Honour then went on (at 399):
Similarly here, a number of the products have probably ceased to be primary products by the time they are delivered to the premises at Kenthurst. In mixing and blending them with spent compost to produce various different products - the range of potting mixes - and bagging and selling them as such, the more appropriate classification to the circumstances is that of the process of manufacture of various goods for sale. In my opinion more than the mere processing or producing of primary products is involved. It follows that I am not satisfied that the development application is for a "rural industry" as defined and is therefore not permissible under this head.
In the alternative the applicant relies on the definition of "landscape supply establishment". It is argued that a range of materials used for landscaping purposes are stored and sold from the premises. Indeed, this definition is relied on in any event where the "primary products" brought onto the land are not handled, treated, processed or packed but merely sold in the form and bags in which they arrive, e.g., imported peat moss.
Again, this is an issue of the proper categorisation of the use. Although a number of the "products" manufactured, stored and sold from the land are materials used for landscaping purposes, one would hesitate to describe the use as a landscape supply establishment. It includes only part of the range of items usually available at such establishments. For example, it sells no sleepers, bush rocks or like products. In fact the "range" of materials is fairly limited. Indeed, the "range" of products is more likely to be retailed in a plant nursery than a landscape supply establishment.
63His Honour then dealt with the dilemma caused by the inter-relationship between the various uses and activities on the land, and found that the uses applied for in the development application were impermissible on the subject land. On balance, the application was refused, on merit.