Westfield Management Ltd v Perpetual Trustee Company Limited and Another

Westfield Management Ltd v Perpetual Trustee Company Limited and Another - [2005] NSWLEC 510 - NSWLEC 2005 case summary — Zoe

[19]

(56) That documentary evidence shall be provided, to the satisfaction of the City Solicitor, that the right-of-way currently applicable to the subject property in favour of the adjoining property, is extended to cover the right-of-way to the "Imperial Arcade" site and the "Centrepoint" site, with reciprocal rights where necessary and such rights shall embody a provision ensuring their application in perpetuity, except with the consent of the Council. 6 In order to understand the significance of the issues it is first necessary to understand the history of the development of the Glasshouse and ownership of the four properties which are located in the city block bounded by King Street on the north, Market Street on the south, Castlereagh Street in the east and the Pitt Street Mall along the west. History 7 On 21 October 1985 the council granted development consent to erect a retail complex and office tower at 141-156A Pitt Street and 135 King Street being a retail and commercial building of 30 storeys subject to the condition that the floor space of the proposed development not exceed 12.3:1. The requirements of the conditions of consent gave rise to amended plans. They became the subject of development application No. 44/85/0257. 8 Council resolved to approve development application No. 44/85/0257 made by Jamino Pty Ltd on 14 February 1986. The consent was communicated by a Notice of Determination dated 26 February 1986. The development approved on 26 February 1986 is described as "a retail commercial building of 31 storeys." The following conditions were imposed:- (1) That the floorspace of the proposed development shall not exceed 12.3:1; … (19) That provision shall be made to the satisfaction of the City Planner, for the connection of the basement service parking levels with the Imperial Arcade and Centrepoint; 9 The reason for the imposition of conditions is noted as follows:- That the granting of unrestricted consent would be likely to cause injury to the amenity of the neighbourhood, including injury due to the emission of noise and vibration and the creation of a traffic hazard and traffic congestion and, further, would not be in the public interest. 10 The permissible floor space ratio ("FSR") was reduced following adjustments to the plans to meet with the conditions of approval. On 14 October 1986 in order to achieve the approved FSR of 12.3:1, New World Oil and Developments Pty Ltd (a member of the Carringbush Group) the then owner of the Glasshouse entered into an agreement to purchase transferable floor space. 11 On 26 May 1987 the council modified development consent No. 44/85/0257 and added the following condition of consent:- (B)(b)That a deed shall be executed between the owners of the subject site and owners of the transferable areas for the transfer of 2601 square metres of bonus floor space to the site to achieve a floor space ratio of 12.5:1 as specified in condition (1) and in the event of that floor space not being purchased floor space ratio shall be reduced to 11.5:1, such deed to be submitted to and approved by the Council prior to the approval of the building application. 12 Condition (1) was also amended to provide that the FSR of the proposed development shall not exceed 12.5:1 13 On 17 March 1988 the architect Donald Crone and Associates Pty Ltd writing on behalf of the developers of Skygarden advised the council as follows:- A pedestrian 'through-site-link' has been incorporated within the Skygarden Development, running North-South linking the 135 King Street Development and Imperial Arcade. Similarly, a vehicle connection has been established with the 135 King Street Development to provide car and vehicular access from King Street. The vehicular access from King Street is based upon the 135 King Street Development (D.A. 44/85/0257 Condition 19) for future connection to Imperial Arcade and Centrepoint.

[20]

14 In a letter 23 March 1988 the following advice in regard to the Glasshouse was given to council by Carringbush Pty Limited ("Carringbush"):- The Sydney City Council approved Mastwood's Development Application which provided vehicular access from Castlereagh Street. Subsequent to our advice to Mastwood Pty Ltd that vehicular access was possible over our site (135 King Street) a Right of Carriageway has been created (subject only to registration at the Land Titles Office) allowing vehicular access to the Mastwood land over 135 King Street. This will eliminate vehicle crossing on Castlereagh Street. Mastwood Pty Ltd have submitted an amended Development Application for their Skygarden development showing vehicular access over 135 King Street, Sydney. The ramifications of this vehicular access/agress [sic] ramp are significant to the point that it will eliminate any vehicular access requirements that would have been necessary from Castlereagh Street for this adjoining property. The opportunity is now presented for this vehicular access/egress to be extended to ultimately incorporate Imperial Arcade and Centrepoint. The provision of such vehicular access to these properties will materially assist in eliminating possible vehicular ramps in Castlereagh Street between King and Market Streets and ultimately a major reduction in goods service vehicles currently traversing the Pitt Street Mall between Market and King Streets. As you will appreciate, this facility is of significant benefit to the mid-town hub of the City and, as such, we request that Council consider a bonus provision of 1:1 be applied to this development. We believe that Bonus element No. 7 under the Development Control and Floor Space Ratio Code 1971 could be applied in order to achieve the bonus, particularly where it is relevant to pedestrian circulation improvements within the Pitt Street Mall and along the Castlereagh Street pavement. Based on the above situation we now seek the Sydney City Council's favourable consideration to allow Jamino Pty Limited to withdraw the Floor Space Ratio purchased for this development. Details of the purchase were forwarded to the Council on 18 June 1987 (copy enclosed).

[22]

16 A further letter was written to the council on behalf of Carringbush on 27 May 1988 as follows:- As explained at our meeting the revised Development Application submitted by Mastwood Pty Ltd was a result of this Company advising that Company access to the basement of their development was able to be secured over our property. This in turn will allow access to Imperial Arcade and Centrepoint basements at some future date thus ensuring all vehicular access being removed from Pitt Street Mall. Previous to all of the above Council had approved the Mastwood development with vehicular access off Castlereagh Street thus eliminating any potential to remove Centrepoint and Imperial Arcade traffic from the Mall and creating additional problems to pedestrians on Castlereagh Street. In consideration of our efforts we requested an additional Floor Space Bonus for the creation of the Right of Carriageway and now seek an early decision from Council. Please refer to our previous correspondence on this matter. 17 This letter appears to have been treated as a precursor to an application to modify consent No. 44/85/0257. On 30 June 1988 the council wrote to Carringbush as follows:- In reply to your letter of 27th May, 1988, regarding the vehicular connection provided over your property from King Street to the adjoining site, the provision of the connection forms an acceptable initial part of a future basement connection to the Imperial Arcade and Centrepoint buildings, as required by the condition of consent. The purpose of the condition is the elimination of the need for vehicular movements, across the footpath generally in the whole block, and in Pitt Street Mall in particular. Thus full compliance requires the submission of a practical proposal, for Council approval, which will achieve the aims, and provide also for allocation of responsibility for supervision, lighting, cleaning, maintenance and like factors of operation. Whilst the development application conditions requires such access provisions, the benefits of full compliance thereto, to the City, are substantial, warranting, in the opinion of Council staff, a recommendation to Council favouring the allocation of bonus for space to the project, within the limits of the maximum floor space ratio already granted. As discussed, in the event that the historic floor space transferred to this development application is not required, it may, in accordance with Council's usual procedure, be allocated by you to a future development application consent. 18 Development consent was granted for the Skygarden development on 12 July 1988. This consent included the condition:- (33) That a suitable right of carriageway over the access from King Street through the adjoining building known as premises, No. 135 King Street, shall be created in favour of the owner prior to the commencement of construction of the subject development; 19 There is no reference in the consent to Skygarden that requires creation of a right-of-way in favour of Imperial Arcade or Centrepoint. 20 On 8 August 1988 Carringbush wrote to the owners of property between the Skygarden development and Market Street inter alia as follows:- A condition of the development consent for the 135 King Street project was the construction of an access corridor to allow goods deliveries to be made via King Street to all properties north of Centrepoint. The location of the right of carriageway created is the car park entry ramp running on the south east access along the eastern boundary of the 135 King Street development. Clearance and width are designed and constructed to accept all goods deliveries to all properties requested by the Council. The adjoining owner Mastwood Pty Ltd (Haysons/Merlin Group) have now established right of carriage over 135 King Street. The access facility will be available to AMP and the head lessee of the Imperial Arcade when construction of Sky Gardens and 135 King Street projects are completed in the latter half of 1989. 21 The then owner of Centrepoint, Australian Mutual Provident Society ("AMP"), replied to the Carringbush letter, noting that no correspondence had been received from the council or any other relevant authority in relation to the use of the access corridor or any variation of AMP's legal right of access to Market Street and that in the circumstances it saw no need to enter into further discussions with Carringbush regarding the matter of the creation of an access corridor. AMP wrote to council on 19 September 1988 in similar terms. 22 Stockland, the owner of the Imperial Arcade, also replied to Carringbush and indicated that it did not appear incumbent upon it to receive deliveries into Imperial Arcade along a carriageway over 135 King Street but that the existence of the carriageway was a matter which may be considered beneficial should the re-development of the Imperial Arcade ever be contemplated. 23 On 10 November 1988 Carringbush obtained a report from Raine and Horne Commercial Pty Ltd ("Raine and Horne") to the effect that the difficulties and additional costs associated with any future re-development of the Glasshouse property due to the need to maintain or provide alternative means of access from King Street to the Mastwood property adjoining, and "any other properties benefiting from the Right of Carriageway at that time" could be valued at up to $3 million. Raine and Horne listed the following effects of the encumbrance on title:- i) The subject property will be burdened by the Right of Carriageway which will create a "blot" on title. ii) The registered proprietor of the subject property will no longer have 100% control over the use and future redevelopment of the property. iii) The registered proprietor of the subject property will incur on-going costs resulting from the creation of the Right of Carriageway associated with additional security and public liability insurance requirements. iv) The property will suffer from general inconvenience associated with the increased traffic flow through the subject property. v) The difficulties and additional costs associated with any future redevelopment of the subject property due to the need to maintain or provide alternative means of access from King Street to the Mastwood property adjoining, and any other properties benefiting from the Right of Carriageway at that time, could be substantial. 24 The Raine and Horne report was forwarded to the council on 11 November 1988. On 13 December 1988 the council modified development consent No. 44/85/0257 by deleting condition (B)(b). Condition 56 was added as a new condition. 25 The report to council by its Planning Committee contained the following submissions:- This development ("Carringbush") has frontage to King Street, Pitt Street and Castlereagh Street, with vehicular access from King Street. The next development to the south "Skygardens" has frontage to Castlereagh Street and Pitt Street, with vehicular access now available from King Street through the "Carringbush" development. The next major development is "Imperial Arcade", an existing structure with vehicular access to Pitt Street Mall. The most southerly development is "Centrepoint" - also with vehicular access to Pitt Street Mall. With a view to elimination of vehicles from Pitt Street Mall as an available option, the "Carringbush development was made subject to the following condition: "That provision shall be made to the satisfaction of the City Planner for the connection of basement service parking levels with the Imperial Arcade and Centrepoint". The first stage i.e. access to "Skygarden" has been achieved. The applicant has sought approval from "Imperial Arcade" and "Centrepoint", but has not succeeded. In return for imposition of a right-of-way over his site and the completion of access arrangements to the adjoining site, and progressing, as far as possible, extension of access to the other two sites, the applicant seeks the award of floor space bonus. This bonus floor space would not increase the building, but would replace the use of transferable historic floor space, which could be utilised elsewhere. Attached are copies of relevant correspondence between the applicant and Council to date:

Letter from Carringbush dated 23rd March, 1988.
Letter from Carringbush dated 27th May, 1988.
Letter from Council dated 30th June, 1988.
Letter from Carringbush dated 11th October, 1988.
Letter from Carringbush dated 11th November, 1988.

[23]

Letter from Carringbush dated 23rd March, 1988: The Company referred to the relevant condition and confirmed that access had been made available to the adjoining property ("Skygardens"), thus enabling elimination of access from Castlereagh Street. A bonus of 1 to 1 was required, under the terms of the "Elective Pedestrian Bonus", as the elimination of vehicular access to Castlereagh and Pitt Streets would be of great advantage to pedestrians. The bonus floor space of 1:1 was to replace the transferable floor space purchased for this site. (Note: The floor space referred to represents a F.S.R. of 1.05:1, not 1:1 as stated). ….
Letter from Carringbush dated 11th October, 1988: The Company advised that the owners of "Imperial Arcade" and "Centrepoint" had been advised of the matter. Both owners had declined the proposition. The applicant company, having taken the matter as far as possible, requested the Council to now consider their request. 26 On 14 August 1990 solicitors acting for the then owner of the Glasshouse wrote to the Director of Planning and Building and the council, inter alia, as follows:- Our client has indeed completed an agreement relating to vehicular access in favour of the adjoining "Skygarden" development. However, precisely as Council Officers advised, our client has no powers to compel the owners of the Imperial Arcade and Centre Point to enter into reciprocal arrangements, as these owners currently have no proposals to redevelop their sites. The result is, precisely as Council Officers advised, that the developers are unable to comply with the conditions imposed by Council. Our client is, however, willing to comply with the spirit and intent of the condition, so far as it is legally within their power so to do. Given that no agreement can be reached relating to the proposed easement in gross with the Imperial Arcade and Centre Point, our client is willing voluntarily to enter into a binding legal agreement with Council, which could be registered against their title, so as to bind successors. It is proposed that such agreement would contain provisions whereby at any subsequent date, Council may require the owner for the time being of 135 King Street to grant easements in gross in favour of the Imperial Arcade, or Centre Point, upon redevelopment of these sites. 27 The Council referred the proposal to the City Solicitor. A suggested form of agreement was submitted to the City Solicitor by the owner's solicitors on 8 March 1991. Amendments were suggested by the City Solicitor. The matter remained under review until 8 January 1996 when negotiations appear to have broken down on account of the difficulties experienced in obtaining reciprocal agreements with the owners of Centrepoint and Imperial Arcade. 28 The following events are relevant:- ·1988 The building of the Glasshouse commenced. ·1990 The building of the Glasshouse completed. ·1991 The Skygarden centre opened. ·1998 Perpetual became the registered proprietor of the Glasshouse. ·2002 Westfield acquired Centrepoint 26 February 2002. ·2004 Westfield acquired Skygarden in August 2004. ·2004 Westfield acquired Imperial Arcade 2 September 2004. ·2004 Westfield submitted a from of transfer granting easement as a Right of Way 6.6m wide to Perpetual for execution.

[24]

29 At all relevant times condition 19 was maintained in the development consent for the Glasshouse. As previously mentioned, condition 56 was first introduced in December 1988 when development consent No. 44/85/0257 was modified by deletion of condition (B)(b). The argument 30 The first respondent, Perpetual, asserts by way of defence that condition 19 was satisfied by provision of the right of way in favour of Skygarden on 26 April 1988. It also pleads that conditions 19 and 56 are invalid as meaningless, unenforceable and beyond power as they did not relate to the Glasshouse development. Moreover, there is no right in rem against the title of the first respondent as registered proprietor under the Real Property Act 1900. No right in rem was created in personam at law, in equity or otherwise in favour of the applicant or the council by any unregistered dealing or condition of development consent. Alternatively, in a cross claim, the first respondent pleads that the conditions were a minor incidental element of the consent and therefore severable or otherwise capable of modification pursuant to s 96 of the EPA Act. 31 In the cross claim the first respondent claims relief by declaration that conditions 19 and 56 are invalid. 32 Westfield pleads an estoppel in answer to the cross claim on the basis that Perpetual's predecessors in title represented to the council that the conditions were enforceable and on that basis obtained the benefit of the development consent. Furthermore, prior to exchanging contracts Perpetual became aware of the conditions of consent and knew that any potential purchaser of the Centrepoint and Imperial Arcade sites would be cognisant of the conditions of consent 33 It is also alleged that Perpetual subsequently became aware that the applicant was considering acquiring the Imperial Arcade and Skygarden sites with the intention of amalgamating those sites with Centrepoint. The applicant claims it exchanged contracts for the purchase of Skygarden and Imperial Arcade in partial reliance upon the effect of conditions 19 and 56. Estoppel 34 It is appropriate to deal with the issue of estoppel at the outset, rather than as the applicant suggests only if the Court has determined that the conditions are invalid and unenforceable. 35 The applicant's argument is based upon the following propositions:-

[25]

(1) A development is in some respects equivalent to a document of title. See Spigelman CJ in Winn v Director-General of National Parks and Wildlife and Others (2001) 130 LGERA 508 at [4] as follows:- A public document, such as a development consent, constitutes a unilateral act on the part of the consent authority expressed in a formal manner, required and intended to operate in accordance with its own terms. It has, as Stein JA points out, an inherent quality that it will be used to the benefit of subsequent owners and occupiers. It is also a document intended to be relied upon by many persons dealing with the original grantee, or assignees of the grantee, in such contexts as the provision of security. In some respects it is equivalent to a document of title. It must be construed in accordance with its enduring functions. (2) The development of the Glasshouse took place upon the assumption by the developer and the council that conditions 19 and 56 were valid, binding and enforceable. (3) Condition 56 was offered by the then owner of the Glasshouse in consideration of being relieved of the burden imposed by the original condition (B)(b). In this respect the applicant relies on that part of a council minute paper comprising a report by the Director of Planning dated 25 November 1988 as follows:- In return for the imposition of a right-of-of way over the site and the completion of access arrangements to the adjoining site, and progressing, as far as possible, extension of access to the other two sites, the applicant seeks the award of floor space bonus. This bonus floor space would not increase the building, but would replace the use of transferable historic floor space, which could be utilised elsewhere. The report recommended the deletion of condition (B)(b). (4) The developer never challenged the validity or enforceability of the consent, as modified. (5) The developer designed and built the Glasshouse in a way that it could meet the physical requirements of condition 19 by providing vehicle access and egress ramps from King Street to the adjoining Skygarden property. (6) When Perpetual acquired the Glasshouse on 19 March 1998 the purchase price took into account the benefit of the consent as well as its restrictions, obligations and burdens. Although the contract for sale incorrectly referred to the 1985 development consent as the relevant consent applicable to the land, nevertheless condition 50 of the 1985 consent was identical to condition 19 of the 1986 consent. (7) The first respondent acquired the land on the basis that it was bound by the conditions of consent and under the terms of its contract with the vendor accepted responsibility for complying with the conditions of consent. In any event the development consent was a public document available for inspection by Perpetual prior to purchase. (8) The first respondent, Perpetual, is bound by the admissions of its predecessor in title made on 14 August 1990 concerning the validity of conditions and set out at [20] above (Jones and Another v Sutherland Shire Council [1979] 2 NSWLR 206).

[30]

39 In Grundt, Dixon J explained that the justice of an estoppel depends on the manner in which the assumed state of affairs has been occasioned or induced. Before a party can be estopped they "must have played such a part in the adoption of the assumption that it would be unfair or unjust if…left free to ignore it." Later in Verwayen, Mason CJ, identified estoppel as a "label which covers a complex array of rules spanning various categories" and then referring to the divisions between common law and equitable estoppel, estoppel by conduct and estoppel by representation he concluded at p 413 that:- … it should be accepted that there is but one doctrine of estoppel, which provides that a court of common law or equity may do what is required but not more, to prevent a person who has relied upon an assumption as to a present, past or future state of affairs (including a legal state of affairs), which assumption the party estopped has induced the other to hold, from suffering detriment in reliance upon the assumption as a result of the denial of its correctness. 40 The decisions of this Court in DTR Securities Pty Limited v Sutherland Shire Council (1993) 79 LGERA 88 and Hilltop Planners Pty Ltd v Great Lakes Shire Council (2003) 127 LGERA 333 do not materially assist the applicant's argument in this case, so far as it relies on representations made by any predecessor in title, as in both cases the representations relied upon were made by one party directly to the other. Mr Hale SC, who appears for the applicant, relies upon a decision of Hutley JA in Jones and Another v Sutherland Shire Council [1979] 2 NSWLR 206. Hutley JA held that an admission by a predecessor in title as to the absence of a relevant planning consent was analogous to an admission against interest by a predecessor in title (citing at p 211 Falcon v Famous Players Film [1926] 2 KB 474 at 498 and extracts from Wigmore on Evidence, Chadbourn Edition and McCormack on Evidence Second Edition). Samuels JA and Mahoney JA reached the same result but did not adopt the same reasoning. No further specific authority has been relied upon to support the applicant's claim that, in the circumstances of this case, the first respondent is estopped by the actions of predecessors in title. 41 The statutory regime in respect of the enforcement of the terms and conditions of development consent contemplates that any person may bring proceedings for an order to remedy or restrain a breach of the EPA Act. The first respondent's cross claim relies upon the Court's jurisdiction in that respect. The Act also recognises that the terms of a consent may be modified within the scope permitted by s 96 (formerly s 102). The section does not abrogate the right of the landowner to seek to obtain successive and possibly conflicting development consents in respect of the same land. The doctrine of estoppel does not fit comfortably with the flexibility of the statutory regime. 42 In Pioneer Aggregates (UK) Ltd v Secretary of State for the Environment [1985] AC 132 Lord Scarman, in the leading speech, decided that as a matter of principle the introduction into the planning law of a doctrine of abandonment by election of the landowner could not be justified as there was a clear implication that only the statute or the terms of the planning provisions itself could stop the provisions enuring for the benefit of the land and of all persons for the time being interested therein. In Hornsby Shire Council v Vitone Developments Pty Ltd (2003) 132 LGERA 122 the Chief Judge, as he then was, considered whether an estoppel is available where the consent authority challenges its own decision to grant consent. McClellan CJ concluded that a council as consent authority would be estopped from denying that a consent has been granted (Brickworks Ltd v Warringah Corporation (1963) 108 CLR 568) but nevertheless would not be estopped from asserting that a purported consent was invalid (see authorities cited in Vitone at [42], [43] and [44]). 43 There is a public interest in ensuring that decisions are made in accordance with the law (Holidays-A-Float Pty Ltd v Hornsby Shire Council (1992) 75 LGERA 127; Hawkesbury City Council v Sammut (2002) 119 LGERA 171). It is understandable therefore that the council does not seek to support the applicant's position on the question of estoppel even though it seeks to uphold the validity of conditions 19 and 56. An estoppel can arise in connection with the enforcement of planning law as the decisions in DTR Securities and Hilltop Planners show but not, it seems, in order to prevent an attack on the validity of a consent granted pursuant to the statutory power under the EPA Act. The justification for this approach is that where the enforcement of a public law is at stake, notions developed for the regulation of the legal relationships between private individuals are not necessarily apposite. 44 Nevertheless assuming for the purpose of argument but not finding to that effect, that the applicant is entitled to claim an estoppel against the first respondent I am not persuaded that Perpetual or its predecessors played such a part in the adoption of the alleged assumption that it would be unfair or unjust if it were left free to ignore it (Dixon J in Grundt at 675 and Waltons Stores at p 404). Neither has it been established by the applicant that either Perpetual, or its predecessor, represented that it had decided unconditionally not to challenge the validity of the condition and that it did not regard itself as free to change its decision or that it relevantly represented that it would not seek to avoid the obligations imposed by the conditions (Waltons Stores at p 422-423 and Verwayen at p 414). Furthermore it has not been proved that Perpetual was ever made aware of any reliance by the present applicant upon the validity of the disputed conditions. When it became apparent during argument that the first respondent perceived an opportunity to cross examine a representative of the applicant about the means by which Perpetual acquired the alleged knowledge about reliance, the applicant withdrew the tender of the documentary evidence that persuaded me to make an order under s 169(1) of the Evidence Act (see Westfield Management Ltd v Perpetual Trustee Company Ltd [2005] NSWLEC 509, unreported). Notwithstanding that the tender of the document was confined to the issue of discretion, the withdrawal nevertheless demonstrated the unwillingness of the applicant to expose a relevant witness to cross examination in respect of the other issue.

[32]

47 In Hillpalm Pty Ltd v Heaven's Door Pty Ltd (2004) 137 LGERA 57 the High Court was dealing with the question of whether a statement of intention to create a right of way on a plan of subdivision constituted a condition of consent that was to be carried into effect within a reasonable time. The majority held that the contention had not been made out. Nevertheless the judges went on to deal with a more fundamental difficulty, namely that any obligation, if it did arise, was not binding on a successor in title. After referring to s 76A(1), that requires development to be carried out only in accordance with a consent, they went on to say that an order to remedy or restrain a breach of the EPA Act could not be made pursuant to s 123 against a person who is not actually in breach of the Act and not threatening to act in breach. It was common ground in Hillpalm, as it appears to be in this case, that the title held by the current owner and successor to the original grantee of consent in respect of the land is not subject to any interest of the kind which Westfield can assert it is entitled to have Perpetual create in its favour by personal action against Perpetual. 48 The position is summarised in the following passage from the joint judgment of McHugh ACJ, Hayne and Heydon JJ at [42]:- 42 No doubt, as counsel for the respondent pointed out, "development", as used in the EP&A, could refer to the subdivision of land, the use of land or to both subdivision and use. It by no means follows, however, that a person occupying a lot in a plan of subdivision carries a development out on the land by simply occupying the land. Where, as here, the subdivision of the land was the relevant development, the subsequent purchaser of a subdivided lot does not "carry that development out" by occupying, and thus using, one of the lots in the subdivision. 49 Orders may be made against a person using land in a manner not permitted by a development consent in breach of s 76A (see Hillpalm at [49]). However the appellant in Hillpalm did not contravene s 76A of the EPA Act by using the land without creating the right of way because it did not carry the development of subdivision out on the land (Hillpalm at [43]).

[34]

52 I agree with Mr Hale that Hillpalm can be distinguished. By dint of s 91(4) the consent is deemed to authorise the use of the building. The consent therefore remains as a source of obligation. Accordingly, relevant conditions of consent continue to apply to the use of the building notwithstanding that the development of erection is complete. The consent authority was necessarily aware that by granting consent to the erection of the building it was authorising the use specified in the development application. Section 91(1) provided for the granting of consent subject to conditions. If conditions 19 and 56 are otherwise enforceable they can be applied to the use of the building if they relevantly relate to that development. 53 Irrespective of how condition 19 is construed it is significant that when the Glasshouse was constructed provision was made for access from the Skygarden site across the Glasshouse site to King Street through the basement of the properties and that a formal right of way was created in favour of Skygarden and registered on the Glasshouse title. The argument regarding whether there is provision of a connection in the physical sense appears to me to have been largely resolved as the ability to actually pass and repass across the applicant's land has been assured ever since the Skygarden and Glasshouse developments were built. At that point arguably condition 19 became otiose. The owners of the Imperial Arcade and Centrepoint for the time being were not able to take advantage of physical access across the Skygarden until the three southernmost properties fell into common ownership in 2004. Moreover two of those owners expressly declined that opportunity in 1988. 54 It must be assumed that the council was aware of condition 19 when it granted building approval to the Glasshouse including the structure that provided the opening between the two buildings. By reference to the terms of condition 56 it is reasonable to construe condition 19 as requiring no more than the provision of a formal and permanent opening and a built carriageway that could in due course be used by the occupiers of Imperial Arcade and Centrepoint subject to appropriate legal arrangements. Condition 56 on the other hand purports only to deal with the process of the legal documentation for the creation of a formal right of way in favour of the Imperial Arcade site and the Centrepoint site. 55 It is appropriate to have regard to the terms of the right of way created on 26 April 1988 as extrinsic material expressly referred to in condition 56. The condition cannot be read sensibly except on the basis that the "right-of-way" referred to is the formal right of way created in favour of Skygarden by registration of the section 88B instrument on that date. 56 I agree with Mr Hale that on the same basis the Court may have regard to the location and physical arrangements of the relevant properties including Skygarden, the Imperial Arcade and Centrepoint as extrinsic material in order to understand the meaning of the condition. It is appropriate to construe the condition so that the interpretation leads to a reasonably practical result (Hecar Investments NOG Pty Ltd v Lake Macquarie City Council (1984) 53 LGRA 322). 57 Section 32(1) of the Interpretation Act 1987 applies to a development consent. A consent "shall be construed as operating to the full extent of, but so as not to exceed, the power conferred by" the EPA Act. If there are different meanings that can be applied then a meaning that does not lead to invalidity of the condition should be adopted (Wechsler v Auburn Council (1997) 130 LGERA 134 at 136; MLC Properties v Camden Council (1997) 96 LGERA 52; Hutchinson 3G Australia Pty Ltd v Waverley Council (2002) 123 LGERA 75). 58 Until August 2004 it was impossible for Perpetual or its predecessors to comply with condition 56 whilever the extension of the current right of way depended upon the co-operation of the owners of the other properties. The reference to "reciprocal rights where necessary" poses a problem for an agreement in mutually satisfactory terms for so long as the parties have differing views.

[35]

59 However before finally addressing the practicalities it is appropriate to consider whether the conditions are the result of a valid exercise of power by the council. For a condition of consent to be valid it must be imposed for a legitimate planning purpose. It also must reasonably relate to the subject matters of the development consent to which it is attached. The test was succinctly explained by the House of Lords in Newbury District Council v Secretary of State for the Environment [1981] AC 578 and adopted in the following terms by McHugh J recently in Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 137 LGERA 232 at [57]:- 1. The condition is for a planning purpose and not for any ulterior purpose. A planning purpose is one that implements a planning policy whose scope is ascertained by reference to the legislation that confers planning functions on the authority, not by reference to some preconceived general notion of what constitutes planning. 2. The condition reasonably and fairly relates to the development permitted. 3. The condition is not so unreasonable that no reasonable planning authority could have imposed it. A condition attached to a grant of planning permission may be invalid although its ulterior purpose is not the sole purpose. If the ulterior purpose is a substantial purpose for which the authority is exercising its power, the condition is invalid. ( Thompson v Randwick Corporation (1950) 81 CLR 87 at 106). 60 It is at least curious that the council did not see fit to impose a condition to compliment conditions 19 and 56 when it approved the Skygarden development (see [19] above). There was no reference to Imperial Arcade or Centrepoint. Westfield's town planning consultant Neil Ingham described the omission as an apparent "slip up" on the part of the council. He describes the planning principle behind the provision of access to the Imperial Arcade and Centrepoint through the existing right of way across the Glasshouse as one to provide the opportunity for goods and service vehicles to be removed from Pitt Street Mall. He says it is a matter of significant planning importance and an appropriate planning objective which will improve the pedestrian movement within the Pitt Street Mall. He acknowledged in cross examination that the failure to provide continuity across the Skygarden site for the benefit of the Imperial Arcade and Centrepoint left the council with no power to enforce any right of access through the Skygarden site. Furthermore he recognises that there is no need for the Glasshouse to use the Pitt Street Mall for access as it has direct entry onto King Street. Obviously there will be an accrual of commercial benefit to Westfield if it can eliminate the requirement to provide access across the frontage to Castlereagh Street or Market Street or both.

[37]

64 The applicant refers to the circumstances under which condition B(b) was deleted when condition 56 was inserted. One of the stated objects of the EPA Act is and was at all relevant dates the protection, provision and co-ordination of the orderly and economic use and development of land. A policy relating to the control of floor space clearly falls within the object of promoting orderly use and development of land. It has not been put to me that a method of transferring floor space or awarding bonuses is an inappropriate policy. If it is accepted that a system that allowed the transfer of floor space and provided for the award of a floor space bonus in certain circumstances is properly a matter of council policy, then condition 56 is to be regarded as a condition imposed for a planning purpose that fairly and reasonably related to the Glasshouse development. 65 Condition 19 is in a different category. So far as I am aware it was imposed without reference to any policy relating to floor space. Its purpose reflected a general planning concept unrelated to the development proposed in 1985 and 1986. However its relevance was enlivened by the circumstances prevailing when condition 56 was added on 13 December 1988. Nevertheless when the Glasshouse provided physical access across the boundary into Skygarden the then owner developer arguably achieved everything that was practical to comply with condition 19 to the satisfaction of the City Planner at that time. 66 The omission by the council to consistently provide for a viable and reasonable mechanism for the implementation of its grand scheme reinforces the conclusion that compliance with condition 56 was not feasible. Critical questions remain unanswered even at the present time. These include important matters such as the amount of consideration to be paid for the grant of the further right of way and the undefined "reciprocal rights." The prospect of the achievement of a consensual outcome is left to speculation. It is not reasonable to require a developer to do that which is impossible without the co-operation of third parties. Particularly where the third parties have no commensurate interest in the subject property. There is a total lack of guidance as to how the object of the condition is to be achieved. There is no discretion vested in the City Solicitor or any other relevant person whereby the developer is able to seek total or partial exemption from compliance. Accordingly there is no opportunity for relaxation of the otherwise strict application of the condition. It is altogether unreasonable, principally as a consequence of its inherent impractability. 67 The fact that compliance is limited to the provision of documentary evidence does not alleviate the imperative to show that "the right of way…is extended to cover the right of way to the 'Imperial Arcade' and the 'Centrepoint' site." Moreover, although the wording of the condition when read literally suggests there is already a right of way to the other two properties that is not the case. 68 The scheme envisages that each of Skygarden and Imperial Arcade would be required to grant rights over their own land. There is the further demand upon the owner of the Glasshouse. Prior to the consolidation of ownership of all of the other properties, compliance with condition 56 was at all relevant times unachievable by unilateral action of the owner of the Glasshouse. 69 The difficulty is amply demonstrated by the rejection of the proposal by AMP and Stockland in 1988. Achievement of compliance with condition 56 presented as an impossibility at the time the building was erected. The owner and builder of the Glasshouse was placed in the position where it was unable to comply with the condition prior to completion of the building. Even so the owner of the Glasshouse wrote to council on 14 August 1990 (see [26]) seeking to resolve the problem by suggesting a compromise. Despite further correspondence over the next six years the apparently intractable problem was not resolved. This lack of resolution further demonstrates the extent of inherent unreasonableness in condition 56. Another weighing factor is the effect on future development of the Glasshouse property refected by the opinion of Raine and Horne (see [23]).

[39]

71 Having regard to the whole of the circumstances applying at the time and the surrounding relevant facts and difficulties of enforcement I determine that the decision of the council to impose condition 56 was so unreasonable that no reasonable planning authority, properly advised, could have come to it (Temwood Holdings and Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223). I reach that conclusion following a consideration of the prevailing facts at the time when the condition was added. The subsequent quirk of history when Westfield became the common owner of all three properties located immediately to the south of the Glasshouse does not rectify or overcome the fundamental unreasonableness of the condition. The context for the assessment of the degree of unreasonableness is the circumstances when the decision was made. At that time, the condition amounted to a relevant abuse of power. It was so devoid of plausible justification that no reasonable person could have imposed it. 72 The degree of perversity can be readily understood by considering whether condition 56 could ever be enforced. It is not an adequate answer to say, as the applicant does, that the condition is anticipatory or ambulatory. Even if the condition is to be construed on the basis that Westfield now holds title to each of the relevant properties it will not lead to a resolution of outstanding issues such as determination of an appropriate consideration to be paid by Westfield or the nature of the so-called "reciprocal rights." The condition is plainly unenforceable without the co-operation and consensus of all relevant parties. They must first reach a mutually satisfactory agreement that takes account of individual legal rights as well as their complex commercial interests. The council would be involved as the consent authority in respect of any development required as a consequence of, or preparatory to, the finalisation of the commercial agreement between the landowners, particularly if there is an intensification of the use of the right of way across the Glasshouse site (see the discussion in North Sydney Council v Ligon 302 Pty Ltd (1996) 185 CLR 470 at 476 and 477). On the basis of its total lack of capacity for practical application, condition 56 is so devoid of utility and purpose that it is relevantly unreasonable in the Wednesbury sense. Alternatively by the same line of reasoning it is void for uncertainty. 73 The effect of condition 56, if enforceable, would be to require the owner of the Glasshouse to obtain the consent of the owner of Skygarden to the use of its land for the purpose of extending the right of way in favour of Imperial Arcade and Centrepoint. That, according to the first respondent, would be unlawful because it would require the owner of the Glasshouse to obtain the consent of third parties before it could act on the consent. Mr Rares SC, who appears for Perpetual, relies on the judgment of the High Court in Ligon at p 478-9 to support that proposition. However as I read the High Court decision it does not raise a relevant matter for determination in the present case. The High Court was considering whether the consent of the owner of other land in the locality over which a right of way already existed was required before an application could be made for development consent to a proposed development on the dominant tenement. The situation here is the reverse. The applicant for approval to modification of the Glasshouse development consent was not seeking to use other land. To the contrary the council was seeking to force the applicant to make its land available for use by other landholders. Whether development consent would be required to enable the other landholders to use the Glasshouse right of way is but one of the complicating factors that reinforce the impracticality of enforcing condition 56. 74 Even if I am wrong about the validity of condition 56 nevertheless the Court would not be in a position to make an order that would require the applicant and first respondent to successfully negotiate a settlement of the terms of their legal relationships (see for example Booker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd (1982) 149 CLR 600 at 604-5). Assuming against the present fact such a settlement can be reached, there would still be the outstanding matter of a further development consent

At a glance

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Cases Cited (22)

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