Universal 1919 Pty Ltd v 122 Pitt Street Pty Ltd

Court of Appeal (NSW)|2019-11-27|Before: Macfarlan JA, Meagher JA, Gleeson JA, Sheahan J, MacFarlan JA

Solicitors: George Xylas Solicitor (Appellant) Stanton & Stanton (First Respondent) Legal Services, Council of the City of Sydney (Second Respondent) File Number(s): 2019/256976 Decision under appeal Court or tribunal: Land and Environment Court Jurisdiction: Class 4 Citation: [2019] NSWLEC 117 Date of Decision: 16 August 2019 Before: Sheahan J File Number(s): 2018/203063

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

The regulatory framework

The EPA Act sets out the relevant laws relating to development and DCOs.
Section 4.2 of the EPA Act, as in force when the DCO was made, relevantly provided: 4.2 Development that needs consent (cf previous s 76A) (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. Maximum penalty: Tier 1 monetary penalty. (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 …
Section 1.5 relevantly defined "development" as follows: 1.5 Meaning of "development" (1) For the purposes of this Act, development is any of the following: … (d) the carrying out of a work, (e) the demolition of a building or work, … (3) For the purposes of this Act, the carrying out of development is the doing of the acts, matters or things referred to in subsection (1). …
"Development consent" was defined by s 1.4 to mean consent under Part 4 of the Act to carry out development. Section 1.4 defined "carrying out of a work" to include, in part, "the removal of, the making of alterations to, or the enlargement or extension of, a work …". Section 4.5, which was included in Part 4, specified, so far as is relevant to the present case, that local councils were consent authorities.
Sections 9.34 and 9.35 empowered local councils to make general development control orders ("DCOs") in accordance with the table to Part 1 of Schedule 5 to the Act. One type of DCO that could be made was identified in item 10 of Part 1 of Schedule 5 as follows: Schedule 5 Development control orders Part 1 General orders Column 1 Column 2 Column 3 To do what? When? To whom? … 10 Restore Works Order An unauthorised building has been the subject of a Demolish Works Order or unauthorised works have been carried out. The owner of the premises, any person entitled to act on a development consent or complying development certificate, any person acting otherwise than in compliance with a development consent or complying development certificate or, in relation to work unlawfully carried out that was the deposit of material in a public place, the person who deposited the material To restore premises to the condition in which they were before unlawful building or other works occurred

Part 4 of Schedule 5 contained the following provisions of present relevance: Part 4 Provisions relating to development control orders 3 Orders affecting heritage items (cf previous s 121S) (1) This clause applies to an item of the environmental heritage: (a) to which an interim heritage order or listing on the State Heritage Register under the Heritage Act 1977 applies or to which an order under section 136 of that Act applies, or (b) that is identified as such an item in an environmental planning instrument. (2) A relevant enforcement authority must not give a development control order in respect of an item of the environmental heritage until after the authority has considered the impact of the order on the heritage significance of the item. (3) A relevant enforcement authority must not give a development control order in respect of an item of the environmental heritage to which subclause (1) (a) applies until after the authority has given notice of the proposed order to the Heritage Council and has considered any submissions duly made by the Heritage Council. … 4 Giving and taking effect of orders (cf previous ss 121N, 121U) (1) A development control order is given by serving a copy of the order on the person to whom it is addressed and takes effect from the time of service or a later time specified in the order. (2) The copy of the development control order is to be accompanied by a notice stating: (a) that the person to whom the order is addressed may appeal to the Land and Environment Court against the order, and (b) the period within which an appeal may be made. 5 Reasons for orders to be given (cf previous s 121L) (1) A relevant enforcement authority that gives a development control order must give the person to whom the order is addressed the reasons for the order. (2) The reasons may be given in the development control order or in a separate instrument. (3) The reasons must be given when the development control order is given, except in an emergency. In an emergency, the reasons may be given the next working day.
Part 5 (headed "Process for giving orders") of Schedule 5 contained the following further relevant provisions: 6 Natural justice requirements (cf previous s 121D) (1) Before giving a development control order, a relevant enforcement authority must comply with clauses 2 [which is not of present relevance], 8 and 9 and Part 7 of this Schedule. (2) … 7 Effect of compliance (cf previous s 121E) A relevant enforcement authority that complies with clauses 2, 8 and 9 and Part 7 of this Schedule is taken to have observed the rules of procedural fairness.
Part 6 (headed "Notices to be given") of Schedule 5 included the following: 8 Notice to be given of proposed order to person who will be subject to order (cf previous s 121H (1)-(3)) (1) Before giving a development control order, a relevant enforcement authority must give notice to the person to whom the proposed order is directed of the following: (a) the intention to give the order, (b) the terms of the proposed order, (c) the period proposed to be specified as the period within which the order is to be complied with, (d) that the person to whom the order is proposed to be given may make representations to the relevant enforcement authority as to why the order should not be given or as to the terms of or period for compliance with the order. (2) The notice may provide that the representations are to be made to the relevant enforcement authority or a nominated person on a nominated date, being a date that is reasonable in the circumstances of the case. In the case of a council this may be to a specified committee of the council on a specified meeting date or to a specified employee of the council on or before a specified date. 9 Notice to be given to other persons and bodies of proposed order (cf previous s 121H (4)-(5)) (1) Notice to other consent authorities If a council proposes to give a development control order in relation to development for which another person is the consent authority, the council must give the other person notice of its intention to give the order. (2) Notice to principal certifier If a council proposes to give a development control order in relation to building work or subdivision work for which the council is not the certifier, the council must give the principal certifier notice of its intention to give the order.
Part 7 (headed "Representations concerning proposed orders") of Schedule 5 included the following: 13 Making of representations (cf previous s 121I) (1) A person who is given notice under clause 8 of the intention to give a development control order may make representations concerning the proposed order in accordance with the notice. (2) For the purpose of making the representations, the person may be represented by an Australian legal practitioner or agent. 14 Hearing and consideration of representations (cf previous s 121J) The relevant enforcement authority that intends to give the development control order or the nominated person is required to hear and to consider any representations made under this Part.
Part 11 (headed "Effect of orders and compliance with orders") of Schedule 5 included the following presently relevant provisions: 29 Development consent or approval not required to comply with order (cf previous s 121O) A person who carries out work in compliance with a requirement of a development control order does not have to make an application under this Act for consent or approval to carry out the work. … 31 Compliance with orders by occupiers or managers (cf previous s 121Z) If an occupier or manager complies with a development control order, the occupier or manager may (unless the occupier or manager has otherwise agreed): (a) deduct the cost of so complying (together with interest at the rate currently prescribed by the Supreme Court rules in respect of unpaid judgment debts) from any rent payable to the owner, or (b) recover the cost (and that interest) from the owner as a debt in any court of competent jurisdiction. 32 Occupier of land may be required to permit owner to carry out work (cf previous s 121ZA) (1) A relevant enforcement authority that gives a development control order may order the occupier of any land to permit the owner of the land to carry out specified work on the land, being work that is, in the relevant authority's opinion, necessary to enable the requirements of this Act or the regulations or of any development control order to be complied with. …
Section 57(1) of the Heritage Act, also referred to in the DCO (see [3] above) was relevantly in the following terms: 57 Effect of interim heritage orders and listing on State Heritage Register (1) When an interim heritage order or listing on the State Heritage Register applies to a place, building, work, relic, moveable object, precinct, or land, a person must not do any of the following things except in pursuance of an approval granted by the approval body under Subdivision 1 of Division 3: … (b) damage or despoil the place, precinct or land, or any part of the place, precinct or land, … (f) alter the building, work, relic or moveable object, …
The above provisions comprised the statutory framework pursuant to which the DCO was issued.

Whether denial of procedural fairness

The DCO was directed to the Owner, as was permitted by Part 1 of Schedule 5 of the EPA Act (see [10] above). As required by clause 8 of Part 6, the Council gave to the Owner prior notice of its proposal to make the DCO and the opportunity to make representations in relation to it. It did not give notice of the proposed DCO to Universal, on the basis that Universal was not a person to whom the DCO was intended to be directed. The Council could, if it had so chosen, have directed the DCO to Universal because, as the Council accepted in this Court, Universal fell within the description of persons to whom a DCO could be directed under item 10 of Part 1 of Schedule 5. The Council however denied that it had any obligation to direct the DCO to Universal and Universal did not argue the contrary. Nevertheless, Universal submitted that, as a matter of procedural fairness, the Council should have given it the opportunity to make representations to the Council because Universal, as the occupier of the premises, would inevitably be affected by the making of the DCO. Universal's principal submission was that a right to procedural fairness arose under the general law.
The primary judge's reasons for rejecting this argument were as follows: "84 While, in its discretion, Council could have chosen to give a DCO to Universal, as the tenant in exclusive possession, and as the entity most closely involved in development works, it was not obliged to do so, but it was required by Item 10 to give the DCO to the owner, and it did so … 85 The EPA Act gives the owner avenues it can follow to ensure it obtains access, in order to comply with the DCO's requirements. 86 The statutory requirements to afford procedural fairness are clear, and were satisfied in this case. 87 There is no authority cited by the Applicant, which would require the Court to find any residual common law obligation on Council to afford procedural fairness to anyone, let alone to anyone other than the recipient of the DCO. 88 [Universal's counsel's] contention … that the degree of heritage significance of the premises provides "more reason" for Council to afford Universal procedural fairness has no substance.
Universal's challenge to the these conclusions can be adequately addressed by asking whether any right that Universal might have had under the general law to be given prior notice of the Council's proposal to make the DCO, and the opportunity to make representations in response, was excluded by the statutory provisions to which I have referred. That question should be answered in the affirmative. I note that the Council did not argue that even if the exclusionary effect of the Act was put aside, Universal did not have a common law right to procedural fairness.
Certainly, a requirement under the general law to afford procedural fairness can only be excluded "by plain words of necessary intendment", rather than "indirect references, uncertain inferences or equivocal considerations" (Annetts v McCann (1990) 170 CLR 596 at 598; [1990] HCA 57; see also Minister for Immigration v SZSSJ (2016) 259 CLR 180; [2016] HCA 29 at [75]). The decisions in Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252; [2010] HCA 23 and Seiffert v Prisoners Review Board [2011] WASCA 148 are instances of courts finding that express statutory exclusionary provisions could operate to exclude or limit requirements for procedural fairness.
The statutory scheme contained in Schedule 5 to the EPA Act in my view contained sufficiently "plain words" to exclude any right that Universal might otherwise have had to be afforded procedural fairness in relation to the issue of the DCO.
Importantly, clause 7 in Schedule 5 provided that an enforcement authority such as the Council "is taken to have observed the rules of procedural fairness" if it complies with certain provisions of the Schedule. These provisions included the requirement under clauses 8 and 14 to give notice of a proposed order to the person to whom the order was to be directed and to consider any representations made by that person. The legislation thus identified to whom notice of a proposed DCO was to be given and what had to occur in consequence. This specification was in my view exhaustive and left no room for Universal's argument that Universal was someone else to whom the Council was required to give notice of the proposed DCO.
Subject to one argument, Universal did not contend that the Council had not complied with the provisions referred to in clause 7. The argument was that Universal should have been given notice of the proposed DCO as it was, under clause 8 of Schedule 5, a person "to whom the proposed order [was] directed", in the sense that the order was effectively directed at Universal because it was the occupier and therefore the person likely to be most immediately affected by the DCO. However, on a plain reading of clause 8, it is clear that "the person to whom the proposed order is directed" means the person to whom the DCO is intended to be addressed. The relevant DCO was clearly "directed" to the Owner, and not to Universal, as it was addressed to the Owner and referred to the Owner as "You". It follows that notice that the Council proposed to issue the DCO was only required to be given to the Owner.

Whether the carving of the Greek flag was an unauthorised building work

Universal first argued that the carving into the cement render of the depiction of the Greek flag was not "development" within the meaning of that word in s 4.2 of the EPA Act. As noted, "development" was defined in s 1.5 to include "the carrying out of a work" (see [8] above). Universal did not suggest that if the carving was a "development", s 4.2(1), which required consent to be obtained, was nevertheless inapplicable according to its terms because the relevant environmental planning scheme, being the Sydney Local Environment Plan 2012, did not require development consent to be obtained.
Although it must be accepted that in some instances work done on a property may be de minimus, it is in my view clear that, due to its size and prominence, the subject carving of the Greek flag constituted "the carrying out of a work" requiring development consent. The decisions in Mulcahy v Blue Mountains City Council (1993) 81 LGERA 302 at 305-8 and Hakea Holdings Pty Ltd v Louisiana Properties Pty Ltd (2018) 98 NSWLR 439; [2018] NSWCA 240 at [93]-[97] on which Universal relied to contend otherwise did not assist Universal, at least for the reason that they were concerned with the terms "building", "erection" and "structure", rather than "development" and "work" which are in issue in the present case. As well, I do not consider that the suggestion in Mulcahy that a purposive approach should be taken to construction of the legislation assists Universal as I can discern no legislative purpose to take work such as that which occurred in the present case outside the purview of the legislation.
Universal further contended that, if development consent was required, it was obtained because the carving was part of the 2016 renovations to which development consent was given. This contention is however contradicted by the contents of the plans for the renovation work that the Council approved in 2016.
The Demolition Plans (appearing at p 233 of the Appeal papers) contain a direction in relation to the relevant wall to "make good … wall" (although the word "good" has been accidentally omitted from the ground floor plan, but not the mezzanine floor plan). The General Arrangement Plans (ibid), showing the post-renovation position, refer to "ARTWORK" on the relevant wall, while an Elevation Plan (at p 234) refers to "DECORATIVE TEXTILE WALL TREATMENT" in respect of the relevant wall. These statements do not extend to a depiction of the Greek flag carved into the cement render. In my view both expressions refer to a supplement to the wall, not to interference with the wall surface. Thus it cannot therefore be said that the carving received development consent. It was therefore "unauthorised" as asserted in the DCO.
As noted above, the DCO also alleged that the carving of the Greek flag did not have the approval that was required under s 57(1) of the Heritage Act 1977 (see [16] above).
In 1988 a Permanent Conservation Order was made in respect of the premises and they were listed as a State Heritage Item in 1999. The description in the State Heritage Register of the premises' significance includes the statement that "The building is aesthetically significant for its well resolved detailing to both its interior and exterior … " (emphasis added). The premises are also listed as a Heritage Item under the Sydney Local Environment Plan 2012, with the listing expressly stating that "interiors" are included. Although Universal argued the contrary, it is in my view clear that in these circumstances substantial work on the interior wall of the premises, such as was constituted by the carving of the subject flag, amounted to the alteration of the building, giving rise to the need for the consent of the appropriate authority under s 57(1) of the Heritage Act (see sub-s (f) of s 57(1)).
By letter of 11 September 2015 the Heritage Council gave consent to renovations that were effected to the premises in 2016. The consent however related to the work described in identified architectural drawings whose contents were to the same effect as those approved by the Council and referred to in [28] above. Although the respective plans appear to be different revisions of the same plans, relevantly they contain the same information and thus, as described in [28] above, do not authorise the subject carving occurring. Accordingly, heritage approval was required, and not given, and the carving was "unauthorised" for this reason also.

Whether notice to the principal certifier required

For the first time on appeal, Universal contended that the DCO was void because the Council did not give to Steve Watson & Partners notice of its intention to issue the DCO. That firm was appointed the principal certifier in respect of the development approval given to the 2016 renovation works. It issued a final occupation certificate on 8 December 2016, specifically excluding from the ambit of the certificate, inter alia, "Removal of the render on the Southern wall". This was a reference to the carving of the Greek flag which I have found above was not authorised to be done as part of the renovations or otherwise. Steve Watson & Partners was not therefore in my view a "principal certifier" to whom the Council was required to give notice under clause 9(2) of Schedule 5 of the EPA Act. The firm's appointment to certify the works did not extend to unauthorised works, the firm specifically ensured that its 2016 certificate did not purport to cover them and by 2018, when the DCO was proposed, the firm had long since ceased to have a role in relation to even the authorised 2016 works. In these circumstances, certainly in 2018, the firm could not properly be described as "the principal certifier" for the "development" in respect of which the Council proposed to make the DCO.
As Universal's argument that Steve Watson & Partners should have been given notice of the proposed DCO fails for the above reasons, it is unnecessary to consider whether Universal should be given leave to raise it for the first time on appeal, and to adduce evidence to enable it to be put. I note that the Council contended that it would be prejudiced if those steps were allowed to be taken. It is also unnecessary to consider whether, as Universal contended, a failure to give a required notice to Steve Watson & Partners would have invalidated the DCO so far as the Owner was concerned (see Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [91]-[92]).

Orders

For the reasons given above, each of Universal's contentions should be rejected. Accordingly I propose that the appeal be dismissed with costs.
MEAGHER JA: I agree, for the reasons given by Macfarlan JA, that this appeal should be dismissed with costs.
GLEESON JA: This appeal should be dismissed for the reasons given by Macfarlan JA.
I would add one brief comment. Insofar as the appellant (Universal) sought to raise a new point on appeal, that the development consent order (DCO) was void because the second respondent (Council) did not give to Steve Watson & Partners notice of its intention to issue the DCO, in accordance with a well-established principle, Universal is not entitled to advance a fresh argument on appeal if that argument "could possibly have been met by the calling of evidence below": Water Board v Moustakas (1988) 180 CLR 491 at 497; Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438. In my view, the present is such a case.

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