Waverley Council v Whitehouse Properties Pty Limited

The decision below

1. The hearing in the Local Court proceeded before Magistrate Richardson over three days. The evidence before the Local Court was extensive. Evidence was given for Council by its Manager of Building Compliance, Mark Featherstone, and by Senior Constable Pazderka. Evidence was given for Whitehouse by the (then) Duty Manager at the Beach Road Hotel, Simon Curtis, and a fire engineer, Michael Bowers, who had prepared an expert report. The Magistrate also received detailed documentary material including the Development Consent and background material thereto; photographs taken during inspections; floor plans of the first floor and courtyard; and liquor licencing details for the hotel.
2. The background facts which are uncontentious in this appeal were recorded by the Magistrate in his reserved written judgment handed down on 6 December 2019 as follows: "The alleged breach relates to the use of the courtyard by patrons contrary to its approved purpose. Mr Featherstone and Senior Constable Pazderka and Sergeant Bolt attended the Beach Road Hotel on 13 September 2017 for an inspection. They attended on the hotel twice, the first inspection started at 10.30pm and lasted 10-15 minutes (Featherstone T16; Pazderka T61) and the second inspection started at 12.45am (Featherstone T17) finishing at 1.00am (Curtis T80). At the first inspection Mr Featherstone gave evidence of seeing "people standing around, smoking, drinking and just standing there" (T17) and people "drinking, smoking, they were standing there, milling around talking" (T21). He did not observe movement of people through the area (T21). "We stood, observed and saw people standing there. They didn't move". Then we moved and "People still weren't moving, they were just standing there, talking, mingling, smoking" (T49). Senior Constable Pazderka said the courtyard on Level 1 was "crowded, very crowded, hard to walk through and lots of people smoking" (T66). It was "hard for me to walk through" (T66). During the second visit, a count of patrons was undertaken. Mr Curtis counted 620 patrons (T78, Exhibit 9 paras 6-8). Mr Featherstone's evidence was they returned to the hotel at 12.45am to "count people leaving the premises" (T17). …"
3. The Magistrate found that: "The evidence establishes that, although crowded with patrons, the officers engaged in the inspections were able to walk through the crowd of patrons on 13 September 2017 on Level 1 in the courtyard (Curtis T78-79, Pazderka T66). The evidence of Mr Featherstone referred to above on this aspect is contradictory. He initially refers to moving "through" the crowd and then clarifies this by reference to moving "around". His evidence on this aspect is not to be relied on. The expert opinion of Mr Bower is that "the presence of that number of persons in the courtyard does not pose any fire safety risk as these people could easily move down the fire safety stairs at the end of the courtyard in times of emergency" (para 7, Exhibit 11 and see also T96-98). During the inspections, a headcount of people was undertaken. Mr Curtis said there were 620 people on the first floor (T78, 79). The development consent allows for a maximum of 650 people (Exhibit 2, condition 19). Mr Featherstone conceded that the inspections on 13 September 2017 were not done to specifically monitor compliance with condition 16 of the development consent (T33, 35). He did not raise or cannot recall raising any issue with Mr Curtis alleging a breach of that condition (T34). Evidence is given by Mr Featherstone that no inquiries were made of patrons seen that night in the courtyard on Level 1 as to why they were there (T46-47). None of the patrons were called to give evidence. This leaves open the possibility that the patrons may have been using the courtyard for the purpose of ingress/egress from the meeting/function/reception room area."
4. The Magistrate then recited and considered the established principles of construction which apply to conditions of development consents (including reference to Snowy Monaro Regional Council v Tropic Asphalts Pty Ltd [2018] NSWCCA 202; (2018) 362 ALR 359 at [34]-[35] and Bunderra Holdings Pty Ltd v Pasminco Cockle Creek Smelter Pty Ltd (subject to Deed of Company Arrangement) (2017) 96 NSWLR 434; [2017] NSWCA 263 in a manner that is without controversy and, having summarised submissions made by the parties, stated: "Consideration Condition 16 in the development consent has to be construed according to its terms and in a way that produces practical results. The meaning of condition 16 is not obvious. Read literally, it permits people to be present in the courtyard on Level 1 only for the purpose of ingress or egress to the function room and egress in the case of fire. It, however, does not prohibit people being in the courtyard. It clearly prohibits the courtyard being blocked by objects inconsistent with patrons ready access to or from the function room and to the fire stairs. The development consent refers specifically to the Turnbull Group Pty Limited report dated July 2004 (Exhibit 2, condition 1). That report contains development plans which were referred to in evidence given by witnesses. Those plans can assist in the interpretation of clause 16. It is noted that there are a number of rooms proximate to the courtyard which have points of entry into the courtyard in addition to the function room. Practically, people using those rooms may use the courtyard on Level 1 to access them. The condition in the development consent refers to the "use" of the courtyard on the first floor. That term has a meaning in Planning Law which is relied on by the accused. Where the use of land is isolated it cannot be said that that land is generally used for that isolated purpose. It is clear from the evidence that the courtyard on Level 1 was inspected on two occasions on 13 September 2017 and that a significant number of people were witnessed standing around drinking and smoking. Mr Curtis referred to the courtyard as the "smoking area". The evidence also established: i) The two inspections on 13 September were short in duration lasting no more than a total of 45 minutes. ii) Despite the inconsistent evidence of Mr Featherstone on his movements through the crowd, people were able to move through the assembled crowd in the courtyard despite the level of congestion. iii) Access to the fire stairs was not obstructed by the people assembled in the courtyard. iv) No inquiries were made of patrons as to why they were assembled in the courtyard during the inspections. Indeed, they may have been in the function room earlier. v) No CCTV footage was requested of the night although it would have been available in all probability. Such footage might have disclosed the manner in which the courtyard was used throughout the evening. vi) The purpose of the inspections was general in nature and not confined to compliance with condition 16. The additional matters were referred to by witnesses in their evidence. vii) Sergeant Bolt was not called to give evidence in the Prosecution's case despite being a material witness. Bearing in mind the interpretation placed on condition 16 in the development consent, the evidence and the onus of proof on the Prosecution, the Court has a reasonable doubt whether all the elements of the offence have been proved to the required standard. That doubt arises from a combination of the seven factors referred to above. The charge is dismissed."

Submissions on appeal

1. Council submits that the Magistrate erred in his application of the principles of construction of Condition 16 and that such an error constitutes an "error of law alone". Council submits that, but for this incorrect construction of Condition 16, the Magistrate would have convicted Whitehouse based upon the facts which he found.
2. Council submits that the Magistrate must have accepted a construction of Condition 16 proffered by Whitehouse as he dismissed the charges "bearing in mind the interpretation placed on condition 16" on the basis of the facts which he found. Put another way, in light of the facts found, and given the decision of the Magistrate to dismiss the charges, Council submits that the Magistrate must therefore have construed Condition 16 incorrectly and thus erred in law.
3. Council submits that the term "only" in Condition 16 was given insufficient weight when construing the condition and that the Magistrate erred in giving the term "use" a meaning other than its plain English definition. Council submits that Condition 16 only allows the courtyard to be used for the purpose of ingress to the function room, egress from the function room, and fire egress.
4. Council submits that construing Condition 16 in a manner which would permit the use of the courtyard as a smoking area or otherwise for pausing, drinking and talking would not yield a result that gives meaning to each of the words in the provision. Upon this construction, even if the persons seen in the courtyard area during the inspections had been in the function room (attached to the courtyard area) earlier, the fact that they had stopped and were drinking and smoking constituted an impermissible use and, further, such a use cannot be said to have been either ancillary or incidental to the permitted uses of ingress or egress.
5. Having regard to other similarly phrased conditions in the Development Consent; the physical characteristics of the courtyard; and possible practical reasons for drafting such a condition including minimising adverse impacts to neighbouring residents, Council submits that the condition cannot be construed as only concerning fire safety as suggested by Whitehouse.
6. Although Council concedes that the Magistrate made a number of factual findings against Council's case, it submits that, had the correct construction of Condition 16 been applied, those facts which the Magistrate did find beyond reasonable doubt would be sufficient to convict Whitehouse.
7. Whitehouse submits that the appeal brought by Council is not merely a "question of law alone" and is instead seeking to challenge a finding of fact, or one of mixed fact and law, made by the Magistrate, which fall outside the scope of appeals brought pursuant to s 42(2B)(b) of the Crimes (Appeal and Review) Act 2001 (NSW). In addition, Whitehouse submits that the appeal ought to be dismissed as it fails to establish that the Magistrate erred in his construction of Condition 16 and further submits that, even if an error was made, given the clear factual findings, such an error would not vitiate the Magistrate's decision.
8. Whitehouse submits that the alleged error of construction has not been sufficiently identified and that Council is instead attempting to impugn the ultimate decision of the Magistrate in order to demonstrate that there had been "some unarticulated error of construction." Further, as the Magistrate did not make a discrete finding in relation to the purpose for which the courtyard was being used, there cannot be said to be an "error of law alone".
9. Whitehouse submits that the decision of the Magistrate was made on the basis that the factual findings made could not prove beyond reasonable doubt that Condition 16 had been breached. Whitehouse submits that this conclusion was thus not arrived at on the basis of a "problematic" construction of Condition 16 and that there is nothing in the Magistrate's decision which suggests that the interpretation placed on the condition was incorrect, misunderstood or impractical. As the decision of the Magistrate was concerned with a failure of proof, no vitiating error is able to be established.
10. Whitehouse submits that the Magistrate was correct in adopting a purposive interpretation of the word "use" and that such an interpretation is consistent with the Environmental Planning and Assessment Act 1979 (NSW) and the notion of use being for a purpose as considered in Chamwell Pty Ltd v Strathfield Council [2007] NSWLEC 114; (2007) 151 LGERA 400 ('Chamwell'). It submits that the language of Condition 16 does not expressly prohibit individuals from holding cigarettes or beverages and that to read the condition in such a manner would require either an impractical construction or one that imports additional words.
11. Whitehouse submits that the Magistrate found that Council had not proven beyond reasonable doubt that the courtyard was used other than for the specified uses and that this doubt arose as a result of the seven factors which were listed in the judgment. Further, it submits that the Magistrate had a doubt as to how the courtyard was being used at the relevant times and could not be satisfied that the persons present in the courtyard were not engaged in ingress or egress from the function room at that time. As such, even if the Magistrate should have given a different or literal interpretation to the language of the condition, the Magistrate nonetheless determined that the facts found were insufficient to prove, to the criminal standard, the manner of use which was occurring at that particular charge time.

Consideration

1. Appeals brought by a prosecutor in this Court against a dismissal of summary proceedings with respect to an environmental offence in a Local Court are limited, pursuant to s 42(2B) of the Crimes (Appeal and Review) Act 2001 (NSW), to grounds which involve "a question of law alone". It follows that, if the appeal is not limited to a "question of law alone", this Court's jurisdiction is not enlivened and the remainder of the proceedings falls away. I will therefore deal with that matter first.
2. Whether an appeal has been brought on a "question of law alone" is a matter dependent upon the statutory context of that expression. Care must be taken when examining how similar expressions or provisions have been interpreted previously: Orr v Cobar Management Pty Limited [2020] NSWCCA 220; (2020) 383 ALR 352 at [32]-[40] (per Bathurst CJ and Bell P).
3. The application of incorrect principles to the consideration of an issue is an error of law alone; however, and in contrast, the incorrect application of the correct principles to the facts is an error of mixed fact and law, not an error of law alone. An appeal on a question of law alone does not include a mixed question of fact and law and the distinction between a question of law alone and a mixed question of fact and law can often be difficult to identify: Mosman Municipal Council v Spice (No 2) [2015] NSWLEC 136; (2015) 212 LGERA 332 ('Spice') at [2] (per Biscoe J); Bimson, Roads & Maritime Services v Damorange Pty Ltd [2014] NSWSC 734 at [39]-[45] (per Beech-Jones J).
4. In R v PL [2009] NSWCCA 256; (2009) 261 ALR 365, which, although considering an appeal from an acquittal pursuant to s 107 of the Crimes (Appeal and Review) Act 2001 (NSW), was also required to be on a question of law alone, Spigelman CJ noted at [26]: "Even if his Honour erred in applying the correctly stated principle, that process necessarily encompassed an assessment of the facts. The process of 'applying' a legal principle to the facts of a case involves a mixed question of fact and law, which, the Crown accepts, is not within s 107(2)."
5. That being said, there is no doubt that whether a statute (or a condition of a development consent) has been construed correctly is a question of law alone as this question may be articulated in the abstract and without requiring reference to the facts at hand.
6. However, the difficulty with which this Court is faced on appeal is that the Magistrate did not precisely articulate the construction or interpretation he placed upon Condition 16. As such, Council's position is that the Court is invited, if not required, to closely examine the facts in order to reveal whether Condition 16 has been incorrectly construed because it is difficult to separate the question of construction from the Magistrate's findings of fact and his ultimate conclusion. In the circumstances, as Whitehouse submits, Council is essentially inviting the Court to imply the existence of an error of construction of Condition 16 on the basis that the Magistrate was not satisfied that the facts he found were sufficient to establish that the offence had been committed.
7. I accept that the ground articulated in the amended summons does isolate a question of law alone. However, to the extent that I properly understand Council's submissions, it appears that Council is pressing that there should have been different findings of fact or mixed fact and law in relation to the issue of use. As Whitehouse submits, it would appear that the "real" case that Council advances is that the Magistrate erred on the issue of whether there was a "use" - being a matter of mixed fact and law. That is, Council's case appears to proceed by way of impugning the overall result, which incorporates findings of fact, to indicate that there has been an error of construction of Condition 16.
8. Neither party contended that the principles of construction which the Magistrate considered in some detail and sought to apply were incorrect. However, Council argues that those principles were applied in a manner which resulted in an overly broad and therefore incorrect construction of Condition 16. To the extent that Council argues that the Magistrate wrongly applied the correct principles to the facts, this precise circumstance was identified by Biscoe J in Spice (at [2]) as being indicative of an error of mixed fact and law and would therefore be a finding with which this Court on appeal cannot interfere. I note that Biscoe J in Spice was similarly considering an appeal such as the present, being an appeal pursuant to s 42(2B)(b) of the Crimes (Appeal and Review) Act 2001 (NSW), and, as noted above, that his Honour recorded (at [2]) that an error of mixed fact and law was not an "error of law alone"
9. However, to the extent that this Court on appeal is able to infer legal reasoning (and thus errors of law) through a close examination of the facts found and conclusions arrived at by the Magistrate, and although I was attracted to the argument that the present appeal does not raise a "question of law alone" and that a finding as such would be determinative, I am of the view that no error of law has, in any event, been demonstrated in the Magistrate's construction of Condition 16.
10. Although the Magistrate made reference to this Court's decision in Chamwell at [27], this is not demonstrative of error and although the word "use" does have a particular connotation in what the Magistrate referred to as "Planning Law", I find that there is no error of law in the Magistrate's consideration that "use" in the present circumstances is to be construed in a purposive sense. Although the relevant principles concerning the construction of a development consent are more easily stated than applied (Allandale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103; (2013) 195 LGERA 182 at [42]), I do not consider that the manner in which the Magistrate considered, interpreted and applied Condition 16 (or the interpretation) was "incorrect, misunderstood or impractical" as suggested by Council.
11. Council's submission appears to assert that the Magistrate should have construed Condition 16 as precluding the mere presence of people smoking and drinking in the courtyard even if those people were migrating to and from the reception/meeting/function room. The condition simply does not so provide. That is, it does not prohibit the mere presence of persons or their standing, smoking and/or drinking. On the facts found, those persons are using (or not preventing the use of) the courtyard for ingress or egress. It appears clear that the Magistrate found that as long as the area remains used (or useable) for one of the identified purposes, the condition was not contravened. Having considered the Magistrate's reasoning and the detailed evidence before him, including the approved plans of the hotel showing the proximity and relationship between the courtyard and the "reception/meeting/function room", and the "… number of rooms proximate to the courtyard which have points of entry into the courtyard in addition to the function room", and his finding that "Practically, people using those rooms may use the courtyard on Level 1 to access them.", I consider that he was entitled to so find. Further, I accept the submission of Whitehouse that there is no proper basis for interpreting Condition 16 as one precluding the mere presence of patrons smoking and drinking in the courtyard irrespective of whether they were engaged in ingress, egress or fire egress at that time.
12. Furthermore, I do not consider that the term "only" in Condition 16 should be given determinative weight in construing the condition and I accept that the inclusion of that word does not mean, as appears to be submitted on behalf of Council, that the courtyard may not be used for other purposes which may not interfere with ingress and egress.
13. Separate to my findings above, even if there was some unspecified error in the construction applied to Condition 16 (which I do not find), such a construction would not vitiate the ultimate finding that the charge had not been proved beyond reasonable doubt. The Magistrate accepted the evidence that the presence of people in the courtyard did not pose any fire safety risk, as well as the other facts recorded at [11] above. This Court on appeal on a question of law only is unable to set aside or depart from the finding that Council had not proved that the courtyard was used other than for one of the permissible uses identified in Condition 16.
14. Even if a strictly literal construction of the condition was adopted, it would not be vitiating given the factual findings which are properly not contested in this appeal. That is, whatever construction is adopted of Condition 16, it could not be said that the factual findings were infected by any such approach taken by the Magistrate to the construction of "use" because the factual findings deal with specific and discrete aspects in the evidence. The Magistrate's areas of doubt were all explicable given the evidence before him as well as his reasoning and findings.
15. The Magistrate was not satisfied beyond reasonable doubt that the courtyard was used for what otherwise would be an impermissible purpose and he found that the reasonable doubt arose from the combination of identified factual findings. Each of these findings, being that - the inspections undertaken on behalf of Council were short in duration; that people were able to move through the courtyard; that access to fire stairs was not impacted; that persons may have been in the function room earlier; that there was no CCTV footage showing the "manner of use"; and other concerns in relation to the adequacy of Council's evidence - all provide a basis for the Magistrate to conclude that the evidence before him did not prove the elements of the offence.
16. These factual findings, which were made after a three day hearing, after cross-examination of a number of witnesses, following the receipt of extensive documentation including plans and background material, and as set out in a detailed reserved judgment produced some months after the final hearing wherein the Magistrate made both discrete findings of fact and findings in relation to the weight to be attributed to evidence of witnesses and the like, cannot, and would not in any event, be impugned and do not indicate any material misunderstanding or misconstruction of Condition 16.
17. In summary, once the full extent of the factual findings made by the Magistrate is understood, it is, as submitted by Council, "inevitable" that whatever nuance the Magistrate may have accorded to the word "use", the evidence marshalled was not sufficient to prove to the criminal standard precisely what was happening at the charge time on the night in question -even if there was some error in the construction of Condition 16.
18. For the reasons above the appeal should be dismissed.

Costs

1. Pursuant to s 49(4) of the Crimes (Appeal and Review) Act 2001 (NSW), the Court may make such order as to the costs to be paid by either party as it thinks just.
2. Council submits that the Court would not make an order for costs if Council successfully demonstrated legal error however otherwise dismissed the appeal on the basis that it is in the public interest to resolve an important point of construction.
3. Whitehouse submits that Council should pay Whitehouse's costs of defending the appeal and notes that there was no disentitling conduct by Whitehouse and, in the circumstances where the Local Court recorded seven factual reasons in favour of Whitehouse, it had no choice but to defend the appeal.
4. I do not consider that Whitehouse has conducted itself in a manner which could be considered disentitling or that the appeal raises novel or important questions that were of such public interest to warrant Council not being ordered to pay the successful respondent's costs of the appeal. As such, I consider it just for Council to pay Whitehouse's costs of successfully defending the appeal.
5. As I consider that an order for costs is appropriate, s 72 of the Crimes (Appeal and Review) Act 2001 (NSW) requires the Court to state the time for the payment of those costs. As such, unless the parties request otherwise, Council is to pay Whitehouse's costs of the appeal within 28 days of those costs being agreed or assessed.

Orders

1. The orders of the Court are: 1. Leave is granted to Waverley Council to rely upon an amended summons filed 17 August 2020. 2. The appeal is dismissed. 3. Waverley Council is to pay the costs of the appeal of Whitehouse Properties Pty Limited, as agreed or assessed, within 28 days after an agreement as to the amount of costs has been made or the issue of a certificate of assessment of any such costs, whichever is earlier.

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: 08 December 2020