Williams v Shellharbour City Council

Land and Environment Court (NSW)|2019-11-11|Before: Moore J, Pepper J

TABLE OF CONTENTS Introduction The separate question proceedings Representation The definition of development The relevant provisions of the LEP The primary matter to be determined The Council's position on this point The Applicant's position on this point Consideration Conclusion Orders

Introduction

On 29 June 2017, Mr Williams (the Applicant) applied to Shellharbour City Council (the Council) to subdivide a parcel of land of 35.9 hectares at Dunmore. The land is known as 167 Swamp Road, Dunmore (the site). The proposed subdivision, if approved, is to be effected pursuant to the Community Land Development Act 1989 (the Community Land Development Act). Development Application 0308/2017 (the DA) seeks consent for the subdivision of the site to create six community title allotments, comprising five rural lots and one common lot.

The separate question proceedings

On 9 September 2019, the Council filed a Notice of Motion seeking to have a separate question hearing held, as the matters proposed to be dealt with in such a separate question hearing were potentially dispositive of the proceedings.
That application was determined by Pepper J on 25 September 2019. Her Honour concluded that it was appropriate to set the matter down for a separate question hearing (Williams v Shellharbour City Council [2019] NSWLEC 135). The questions determined by her Honour as appropriate to be dealt with at that hearing were in the following terms: (a) is the proposed development, which is a community title subdivision, "development for any purpose" pursuant to cl 5.10(10) of Shellharbour Local Environmental Plan 2013 ("LEP")? (b) if the answer to question (a) is "no", is the proposed development, being a community title subdivision which proposes lots that are less than the minimum subdivision size shown on the Lot Size Map in relation to the subject land pursuant to cl 4.1AA of the LEP, permissible with consent under the LEP?
It is also to be observed that, at the commencement of this separate question hearing before me, the Council sought leave to add an additional question to those set down by Pepper J. Leave to add that additional question was not opposed by the Applicant. However, given the conclusion I have reached concerning (a) of the separate question, it is unnecessary to consider this further question or to set out its terms. Similarly, as the written submissions for the Applicant conceded (submissions at [3]), a negative answer to (a) mandates a negative answer to (b).
Although a merit hearing of the DA is currently set down, that hearing is rendered unnecessary given I have concluded that the answer to question (a) is "no"; the proposed development is, as a consequence, prohibited; and the DA must therefore be refused.

Representation

The Applicant was represented by Mr A Pickles SC, whilst the Council was represented by Mr A Galasso SC.

The definition of development

The concept of development relevant to these proceedings is defined in Environmental Planning and Assessment Act 1979 (the EP&A Act) and encompasses the concept of subdivision - including, necessarily, subdivision under the Community Land Development Act (s 1.5(1)(b) of the EP&A Act).

The relevant provisions of the LEP

A number of provisions of the LEP arise for consideration in these proceedings. First, the LEP contains a general provision that acknowledges that subdivision of land to which the plan applies is permissible with development consent. This provision is in the following terms: 2.6 Subdivision - consent requirements (1) Land to which this Plan applies may be subdivided, but only with development consent. (2) Development consent must not be granted for the subdivision of land on which a secondary dwelling is situated if the subdivision would result in the principal dwelling and the secondary dwelling being situated on separate lots, unless the resulting lots are not less than the minimum size shown on the Lot Size Map in relation to that land.
Other elements of the LEP deal, expressly, with different potential types of subdivision under the broad umbrella of the permissibility afforded by cl 2.6(1). The first of them is cl 4.1 Subdivision. Although cl 4.1 makes general provision for subdivision, subdivision utilising the Community Land Development Act is expressly excluded from its operation by cl 4.1(4)(b).
However, the LEP also contains minimum lot sizes for subdivision for community title schemes proposed to be effected pursuant to the Community Land Development Act within specific land use zones. These are contained in cl 4.1AA. There is no dispute that the clause applies to the proposed development. The provision is in the following terms: 4.1AA Minimum subdivision lot size for community title schemes (1) The objectives of this clause are as follows: (a) to ensure that land to which this clause applies is not fragmented by subdivisions that would create additional dwelling entitlements. (2) This clause applies to a subdivision (being a subdivision that requires development consent) under the Community Land Development Act 1989 of land in any of the following zones: (a) Zone RU1 Primary Production, (b) Zone RU2 Rural Landscape, (c) Zone RU6 Transition, (d) Zone E2 Environmental Conservation, (e) Zone E3 Environmental Management, (f) Zone E4 Environmental Living, but does not apply to a subdivision by the registration of a strata plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies (other than any lot comprising association property within the meaning of the Community Land Development Act 1989) is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause applies despite clause 4.1.
However, the proposed subdivision of the site does not satisfy cl 4.1AA(3) and therefore this provision does not operate to facilitate this proposed subdivision.
Next, the LEP contains cl 4.6, a beneficial and facultative provision that permits a request to be made to dispense with compliance with a development standard. However, cl 4.6(6) of the LEP excludes the possibility of a request to contravene the development standard arising from cl 4.1AA(3) for land within Zone E3 Environmental Management and Zone RU2 Rural Landscape if: (a) the subdivision will result in 2 or more lots of less than the minimum area specified for such lots by a development standard, or (b) the subdivision will result in at least one lot that is less than 90% of the minimum area specified for such a lot by a development standard.
There is no contest that those provisions are engaged by the present proposal.
As a consequence of the exclusionary effects of the above provisions, the Applicant solely relies on another provision of the LEP - it being one providing an exception for development on land where heritage items are located. This is contained in cl 5.10(10), a provision in the following terms: 5.10 Heritage conservation … (10) Conservation incentives The consent authority may grant consent to development for any purpose of a building that is a heritage item or of the land on which such a building is erected, or for any purpose on an Aboriginal place of heritage significance, even though development for that purpose would otherwise not be allowed by this Plan, if the consent authority is satisfied that - (a) the conservation of the heritage item or Aboriginal place of heritage significance is facilitated by the granting of consent, and (b) the proposed development is in accordance with a heritage management document that has been approved by the consent authority, and (c) the consent to the proposed development would require that all necessary conservation work identified in the heritage management document is carried out, and (d) the proposed development would not adversely affect the heritage significance of the heritage item, including its setting, or the heritage significance of the Aboriginal place of heritage significance, and (e) the proposed development would not have any significant adverse effect on the amenity of the surrounding area.

The primary matter to be determined

It is appropriate to repeat, incorporating relevant emphasis, the chapeau to cl 5.10(10), as it contains a threshold test which must be satisfied as a precursor to any consideration of whether or not the consent authority could be satisfied with respect to each of the relevant tests engaged by cl 5.10(10)(a) to (d). That chapeau, with appropriate emphasis, appears below: The consent authority may grant consent to development for any purpose of a building that is a heritage item or of the land on which such a building is erected, or for any purpose on an Aboriginal place of heritage significance, even though development for that purpose would otherwise not be allowed by this Plan
There is no contest that the site is land upon which heritage items are erected (the dry stone walls relevantly constitute buildings, as well as the house, for these purposes). The sole issue requiring to be considered, for the making of this determination, is whether the proposed subdivision is development for any purpose.

The Council's position on this point

The Council does not challenge the proposition that development includes subdivision of land (see [12]).
The position advanced for the Council by Mr Galasso was one which was entirely conventional. He explained why, in the Council's submission, authority established that: 1. Subdivision does not constitute a use of land; and 2. As a consequence, a proposal for a subdivision does not seek approval for development for any particular purpose as a use of land is a necessary precursor to a purpose; therefore 3. The proposed subdivision is not development for any purpose for the purposes of the test in the chapeau to cl 5.10(10) of the LEP and is, therefore, prohibited.
The starting point for these propositions put by Mr Galasso is to be found in the decision of Sugerman J in Smith v Randwick municipal Council (1950) 17 LGR (NSW) 246 (Smith) where his Honour explained, at 250, that: The approval of a subdivision into lots is in law, the approval of the subdivision simpliciter not its approval with any condition or for any particular purpose, such as shops or dwellings et cetera.
His Honour further explained that later development of a subdivision would be dealt with by subsequent applications (at that time, pursuant to the Local Government Act 1919). His Honour continued (also at 250): The Local Government Act does not contribute any particular effect to approval of a subdivision as regards the uses to which the subdivided land may be put, or the buildings which may be erected upon it.
Mr Galasso submitted that, in Wehbe v Pittwater Council [2007] NSWLEC 827; (2007) 156 LGERA 446 (Wehbe), Preston CJ more recently addressed, relevantly, the broad proposition that subdivision does not involve any use of land. At [28], his Honour cited and adopted the first of the elements of the judgment of Sugerman J quoted above.
As a consequence, the Council submitted that a similar two-stage approach would be required with respect to the proposed subdivision of the site - that two-step approach being approval for subdivision and, subsequently (and only available if subdivision was approvable and was approved), application for development consent for any proposed use(s) of the land as subdivided. Mr Galasso submitted that this approach was consistent with the decision of Preston CJ in Chamwell v Strathfield Council [2007] NSWLEC 114; (2007) 151 LGERA 400 where, at [27], his Honour remarked that: … In planning law, use must be for a purpose … The purpose is the end to which the land is seen to serve … [Council's written submissions at [32]]
The Council's concluding submission, founded on the above, is that because subdivision is not a use, and a use must provide the foundation for which the purpose of a development is proposed to be effected, in the absence of a use there can be no purpose and that, necessarily, the absence of a purpose necessitates the present proposed subdivision of the site falling at the hurdle of the introductory test to cl 5.10(10) of the LEP.
Mr Galasso submitted that this approach was consistent with, and supported by, the decision of the Court of Appeal in Broker Pty Ltd v Shoalhaven City Council [2008] NSWCA 311; (2008) 164 LGERA 161 (Broker) where, although dealing with development contributions, Campbell JA (with whom Handley AJA agreed) rejected the proposition that the consent for residential subdivision was an implied consent for the use of the land for residential purposes (at [73]). Mr Galasso's written submissions, at [38], summarised, in the following terms, the four bases for this conclusion set out by Campbell JA at [75] to [87]: (1) Firstly, the subdivision consents were for no more than the subdivision of the land. While the lots were of a size and configuration and the conditions imposed required services to be provided to those lots and restrictions as to users under section 88B of the Conveyancing Act 1988 (NSW) to be imposed that were "obviously intended to make the lots ones that would ultimately be suitable for residential occupation", the consents were not implied consents to any occupation of the land, whether for residential or other purposes. (2) Secondly, even if there were any implied consent to residential use of the lots in the subdivision, the implied consent would not be unconditional and would not inhibit the respondent's later consideration of development applications concerning the land. (3) Thirdly, nothing in former section 81A(3) of the EP&A Act stated that a development consent for the subdivision of land authorised any other activity at all. (4) Fourthly, Campbell JA found the appellant's submission to be contrary to several cases, including the judgment of Sugerman J in [the] Smith case and Preston J in Wehbe.
On the basis outlined, the Council proposed that the first element of the separate questions should be answered in the negative.

The Applicant's position on this point

Mr Pickles submitted for the Applicant that the approach taken on behalf of the Council was flawed because the line of authority relied upon was derived from different statutorily contextual positions and did not commence with an analysis of the text of the relevant element of the LEP itself. He advanced four reasons why an appropriate contextual analysis of the use of the expression "development for any purpose" in the chapeau to cl 5.10(10) was not to be understood in the fashion proposed for the Council. The reasons he gave for this were comprehensively summarised at [16] to [19] of his written submissions. These four propositions were in the following terms: 16 First, the reference to "development for any purpose" in cl 5.10(10) is not limited to a purpose identified in the Land Use Table. Accordingly, any development for any purpose is captured by the provision. 17 Secondly, there are a number of textual indicators elsewhere in the LEP that suggest that the subdivision of land must be for a purpose. Several of the development standards applying to the subdivision of land expressly refer to "purpose" in the context of controlling the size of lots where subdivision is to be carried out. Even in those provisions which do not expressly refer to purpose, it is implicit, either in the objectives of the clause or the machinery provisions, that the subdivision will be for a purpose. It is these provisions, which are development standards, which result in the subdivision in this case being a development for a purpose that would not be allowed by the LEP. 18 Thirdly, in the specific instance of cl 4.1AA, it is implicit in the concept of community title subdivision that the land will be subdivided for further development. The express reference to the CLD Act imports into the clause the aims and objectives of that Act which includes, relevantly: Subject to subsection (2), the object of this Act is to facilitate the subdivision of land into parcels for separate development or disposition…" (emphasis added) If the aim and objective of community subdivision is to facilitate further separate development, it would be contrary to the objective of both clause 4.1AA and the CLD Act to suggest that subdivision can have no purpose. 19 Fourthly, the application is described as being "the subdivision of land to create six (6) Community Titled allotments … which includes: (i) Earthworks to create a 20 metre x 30 metre building entitlement envelope…" Works comprise another form of development, in addition to subdivision, which has a clearly stated purpose. Although not part of this development application, it would equally have been open to include proposals to construct dwellings within the proposed envelopes. In addition, the proposal includes retention of existing dwellings on two of the proposed lots, one of which was erected as a rural worker's dwelling. In that respect the proposal includes an application for a new use of that dwelling, being a dwelling house, which is also a purpose.
In addition to these constructional propositions, Mr Pickles relied upon the decision of the Court of Appeal in Lennard v Jessica Estates Pty Limited [2008] NSWCA 121; (2008) NSWLR 306; (2008) 159 LGERA 420 as support for the proposition that subdivision of land does have a purpose in a planning context (as is, he submitted, here applicable).
Lennard v Jessica was a case involving the issue of whether a restrictive covenant on an allotment within a community title subdivision acted as a prohibition on further subdivision of that allotment as a prohibition on a land use, in the context of cl 6(1) of the Singleton Local Environmental Plan 1996. This provision is, relevantly, in the following terms: 6 How does this plan affect covenants etc? (1) If any agreement, covenant or similar instrument prohibits a land use allowed by this plan, then it shall not apply to that land use (to the extent necessary to allow that land use).
The particular passage in Lennard v Jessica relied upon by Mr Pickles is in the judgment of Tobias JA (McColl and Bell JJA concurring), where his Honour said, at [61]: 61 The prohibition on subdivision contained in para (k)(v) is more problematic. The issue is whether "a land use allowed by" the LEP includes the subdivision of land for a particular purpose of use. It is true that in some contexts the cases have drawn a distinction between the subdivision of land on the one hand and the use of land as subdivided on the other. That distinction has been covered in the definition of "subdivision of land" in s 4B(1) of the EPA Act which contemplates the division of land into two or more parts anterior to the actual use or occupation of those parts. However, in my opinion the expression "a land use" in cl 6(1) of the LEP is capable of including the subdivision of land for the purpose of a use permitted by the LEP. Generally speaking, in the context of planning, land is not subdivided except for a particular purpose. Thus the Estate was subdivided for the purpose of creating residential lots i.e. lots intended to be used for residential purposes.
In his submissions, Mr Pickles drew specific attention to the sentence in the above-cited passage where his Honour said: Generally speaking, in the context of planning, land is not subdivided except for a particular purpose.
Mr Pickles explained why, in his submission, Smith and Wehbe were to be distinguished as not being on point to the present circumstances. As a consequence, in his submission, the decision of the Court of Appeal in Broker, although supporting and building upon Smith and Wehbe, stood, in Mr Pickles submission, for no more than the proposition that subdivision does not amount to an actual or implied consent for the use of land (written submissions at [26]).
The broad conclusion put by Mr Pickles was that the various authorities relied upon by Mr Galasso do not act as support for the proposition that subdivision has no purpose, merely that subdivision is not a use of land. The conclusion that he submitted should be drawn for the test in the chapeau to cl 5.10(10) of the LEP is that, in this context (as was contextually appropriate in Lennard v Jessica), the proposed subdivision has a (planning) purpose and is, therefore, capable of being approved.
In this context, he submitted that the answer to (a) of the separate question should be "yes" (and the Class 1 appeal proceed to hearing as currently set down).

Consideration

I am satisfied that the analysis advanced by Mr Galasso for the Council is correct for the reasons he advanced. The four contextual propositions advanced by Mr Pickles for the Applicant and his basis advanced for reliance on Lennard v Jessica are flawed for the reasons which follow.
The first of Mr Pickles' contextual propositions is undoubtedly correct as the chapeau to cl 5.10(10) makes it expressly clear that the concept of development for any purpose is unconstrained by the Land Use Table or any other provision of the LEP by the incorporation of the words "even though development for that purpose would otherwise not be allowed by this Plan". However, unless, in an appropriate fashion, subdivision can be established to be a development for a purpose, this proposition provides no comfort to the Applicant.
With respect to Mr Pickles' second contextual proposition, the subdivision-related provisions in the LEP in cll 4.1, 4.1AA, 4.2A and 4.2B do not contain, expressly or by implication, any notion of purpose. In cl 4.1A, the purposes adverted to are the uses set out in column 1 in the table following cl 4.1A(2). The purposes there identified are clearly contextually related to the identified development in the column and not the concept of subdivision itself. The same broad proposition applies in cll 4.1B(2) and 4.2(3).
The consequence of this analysis is that I am unable to accept that the other provisions in the LEP dealing with the issue of subdivision provide any assistance in the fashion proposed by him in Mr Pickles' second textual analysis proposition.
With respect to his third contextual proposition, it is clearly necessarily implicit from the element of the Community Land Development Act quoted in [18] of Mr Pickles' written submissions that separate development means development subject to a subsequent application made to the relevant consent authority. This is entirely consistent with the position that follows from Smith and Wehbe as relied upon by the Council. For this reason, I cannot see that this proposition provides any assistance in the present context advanced for the Applicant.
Mr Pickles' fourth contextual proposition also fails for the reasons explained (although in a different but analogous context) by Preston CJ in Wehbe at [25] to [27]. The earthworks to which Mr Pickles makes reference would fall within the scope of the (now) s 1.5(1)(d) of the EP&A Act and not within s 1.5(1)(a) and, as his Honour observed, (by analogy) earthworks may be preparatory to some other type of development such as the erection of a building or the use of the land but it is not part of that other development but is part of the proposed subdivision.
As a consequence of the foregoing, the contextual propositions relied upon by Mr Pickles are, in my view, not of any assistance to the Applicant.
As to Lennard v Jessica, it is first appropriate to note (and set aside) the fact that the Court of Appeal's decision in Broker was given on 24 November 2008, some nearly six months after that in Lennard v Jessica. This temporal position is rendered irrelevant as the (differently constituted) Court in Broker does not appear that the decision in Lennard v Jessica was the subject of submissions in that case nor was it drawn to their attention.
Relevantly, however, some further consideration of the specific details of the particular factual circumstance of that case require mention before turning to consider what, if anything, is to be drawn from it in the context of the present proposed subdivision.
At [1] to [6], Tobias JA set out the relevant factual position: 1 The respondent, Jessica Estates Pty Ltd (Jessica), is the developer of 121 residential lots at Singleton known as the "Hunter View Estate" (the Estate), which comprised the whole of the land in DP 1061723. 2 On 24 July 2006 the appellants, Mr and Mrs Lennard, purchased Lot 122 in the Estate (Lot 122) which was then vacant. The appellants were not its first purchasers. Camilla Romano originally purchased the Lot 122 from the respondent in 2003. 3 All lots in the Estate were subject to an instrument lodged with the Deposited Plan under s 88B of the Conveyancing Act 1919 (NSW) (the Instrument). Item 5 of Part 1 of the Instrument identified a restriction on the use of each lot in the Estate, the benefit of which was ascribed to each other lot (the restriction). The terms of that restriction on use were set out in Part 2 of the Instrument of which para (k) is presently relevant: "(k) Unless the Registered Proprietor obtains the prior written consent of Jessica the Registered Proprietor shall not: (i) construct more than one dwelling on the Lot Burdened, (ii) construct any building of the nature known as semi-detached duplex on the Lot Burdened, (iii) use or permit to be used the Lot Burdened for any purpose other than as a private dwelling, (iv) alter a building on the Lot Burdened in such a way as to create a further dwelling on the Lot Burdened, (v) subdivide the Lot Burdened, and (vi) operate or permit to be operated upon or about the Lot Burdened a childcare centre, kindergarten or other similar activity." 4 On 15 March 2007, Singleton Council (the Council) granted development consent to the erection of two three-bedroom residential units upon Lot 122. The proposed development was in the form of two attached dwellings identified in the Singleton Local Environmental Plan 1996 (NSW) (the LEP) as "dual occupancy - attached". It was common ground that this type of development constituted a semi-detached duplex within the meaning of para (k)(ii) of the Instrument. 5 Subsequently, on 20 June 2007 the Council granted development consent to a two-lot strata subdivision of Lot 122. Again, it was common ground that such a subdivision fell within the terms of para (k)(v) of the Instrument. 6 Construction of the duplex without Jessica's consent commenced on 5 July 2007.
With respect to what little is to be drawn from Lennard v Jessica, the passage at [61] of Tobias JA's decision must be read in its appropriate context. Although [61] is proposed by Mr Pickles to embody matters of general principle relevant in the present context, the terms of [62] and [63] make it clear that the conclusion which his Honour reached was confined to the factual circumstances of the particular subdivision proposal. This can be seen from an examination of those paragraphs when coupled with the factual matrix earlier set out by me above.
These further paragraphs from his Honour's reasons are in the following terms: 62 In the present case, the Council granted its consent to a strata plan of subdivision of the duplex to enable it to be separately used and occupied as two dwellings. In these circumstances I see no reason why the subdivision or strata subdivision of Lot 122 in the present case was not a subdivision for the purpose of enabling its use for two dwellings and so constituted "a land use" within the meaning of cl 6(1). 63 Such a construction accords with common sense and the language of cl 6(1) is not so intractable as to deny its adoption. It would in my opinion border on the irrational to exclude the strata subdivision of the duplex where otherwise the duplex may be constructed and used for the purpose of separate dwellings.
As can been seen from the facts in the extract at [48] above, the position with which his Honour was addressing was one where two consents (the second being for the purpose of use of the subdivided land for a duplex dwelling) had been granted. This was a quite different position to the present circumstances. The above quoted [62] and [63] of his Honour's reasons make it clear that he was responding to this specific position not addressing any broader matter of principle.
As consequence, I am unable to conclude that there is any error in the broad line of authority relied upon by the Council as supporting the proposition that the words development for any purpose in cl 5.10(10) does not incorporate this subdivision as proposed within its scope.

Conclusion

For the reasons that I have set out, I am satisfied that the first of the questions proposed for separate determination by Pepper J should be answered "no". It therefore follows, as was accepted by the Applicant, the second of her Honour's questions must also be answered in the negative.
In light of this, I have also concluded that it was unnecessary to address and determine the additional question for which the Council was granted leave to raise at the commencement of the hearing.

Orders

The orders of the Court, therefore, are: 1. The question "is the proposed development, which is a community title subdivision, "development for any purpose" pursuant to cl 5.10(10) of Shellharbour Local Environmental Plan 2013" is answered "no"; 2. The Class 1 appeal is dismissed; 3. Development Application 0308/2017 for subdivision of 167 Swamp Road, Dunmore pursuant to the Community Land Development Act 1989 is determined by the refusal of development consent; 4. Costs are reserved; and 5. The exhibits are returned.

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: 06 February 2020

Conveyancing Act 1988(NSW)

(2008) 164 LGERA 161

(2007) 151 LGERA 400

(2008) 159 LGERA 420

(2007) 156 LGERA 446

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