Town Planning and Development Act s 11(1), s 12(2a)(b)(ii)

1 IPP J: I have read the reasons to be published by Anderson J. I agree with them and his Honour's conclusions. I have nothing further to add.

2 ANDERSON J: This is an appeal from a decision of Murray J delivered on 30 October 1998 answering two questions arising in a commercial arbitration. Only one of those answers is the subject of the appeal.

3 The matter being arbitrated is the appellant's entitlement to compensation for injurious affection under s 11(1) of the Town Planning and Development Act. By that section:

"Any person whose land or property is injuriously affected by the making of a town planning scheme shall ... be entitled to obtain compensation in respect thereof from the responsible authority ... "

4 The scheme in question is the Shire of Harvey District Planning Scheme No 1 which was promulgated on 12 November 1996. The appellant is the owner of a parcel of land in the scheme area which he uses for the purpose of a residence. The scheme rezoned the appellant's land from "Special Rural", in which residential use was permitted, to "Kemerton Buffer". The primary purpose of the new zone was to create a belt of low density land use between the Kemerton industrial zone and surrounding land. The zoning provisions in the scheme are quite elaborate, but it is not in dispute that, relevantly to this case, the essence of them is that residential use is not a permitted use in the buffer zone.

5 The case was argued below and before us on the basis that the use of the land by the appellant for residential purposes is now a non-conforming use within the meaning of Pt 10 of the scheme and the claim for compensation is put on the basis that the making of the scheme has therefore reduced the value of his land.

6 It is necessary to set out the relevant provisions of the Act and the scheme. I have already set out those provisions of s 11(1) which confer the right to compensation for injurious affection. There are important qualifications on that right, set out in s 12 and the provisions of s 12 which are relevant in this case are s 12(2a)(b) and (c) as follows:

"12.(2a)(b) Subject to the provisions of paragraph (c), land shall not be deemed to be injuriously affected by reason of any provision of a town planning scheme ... which deals with

any of the matters specified in clause 10 of the First Schedule, unless the scheme

(ii) prohibits wholly or partially the continuance of any non-conforming use of that land or the erection, alteration or extension on the land of any building in connection with or in furtherance of, any non-conforming use of the land, which, but for that prohibition, would not have been an unlawful erection, alteration or extension under the laws of the State or the local laws of the local government within whose district the land is situated.

(c) Notwithstanding the provisions of paragraph (b) a provision of a town planning scheme which prescribes any requirement to be complied with in respect of a class or kind of building shall not be deemed to have the effect of so prohibiting the erection, alteration or extension of a building of that class or kind in connection with, or in furtherance of non-conforming use."

7 It is not in dispute that the relevant provisions of the scheme under which the appellant's claim arises are provisions which "deals with ... matters specified in clause 10 of the First Schedule". The First Schedule enumerates the purposes for which a town planning scheme may be made and cl 10 provides that one of the purposes is "zoning of the scheme area ... and prohibiting in any of these zones ... any building or use of land of or for a general or particular nature or purpose". It is quite clear that the provisions of the scheme in question in this case do deal with such matters.

8 The question that was submitted to Murray J under the Commercial Arbitration Act 1985 (WA) s 39(1)(b) was:

"1. Do the provisions of Part 10 of the New Scheme fall within the terms of section 12(2a)(b)(ii) of the Town Planning and Development Act?"

9 As I have said, there was another question, but we are not concerned with it.

10 His Honour answered the question "No". By this answer, he ruled, in effect, that no provision of the scheme wholly or partially prohibits the continuance of a non-conforming use of land within the scheme area or wholly or partially prohibits the erection, alteration or extension of buildings used in connection with a non-conforming use.

11 The appellant contends that the scheme does prohibit wholly or partially the continuance of his non-conforming use, within the meaning of the first 13 words of s 12(2a)(b)(ii) and does also prohibit wholly or partially "the erection, alteration or extension on the land of any building in connection with or in furtherance of" his non-conforming use within the meaning of the second part of s 12(2a)(b)(ii). The provisions in the scheme which are said to do this are cl 10.2 and cl 10.5 which are in the following terms:

"10.2 A person shall not alter or extend a non-conforming use or erect, alter or extend a building used in conjunction with a non-conforming use without first having applied for and obtained the planning consent of the council under the scheme and unless in conformity with any other provisions and requirements contained in the scheme, and the council may require;

(a) compliance with the requirements applicable to any zone in which the non-conforming use is carried on;

(b) compliance with the requirements applicable to the zone in which the non-conforming use would, subject to compliance with the other provisions of the scheme, be permitted;

(c) compliance with any requirements applicable to the use class in which the non-conforming use is comprised, in any zone in which that use class is permitted; or

(d) compliance with any other requirements which the council may specify for the purpose of securing the amenity, health or convenience of the area. In this regard the council may waive any of the requirements of (i), (ii) and (iii) above if, in its opinion, a better development, within the meaning of this subclause, will result.

10.5 If any building is ... being used for a non-conforming use, and is subsequently destroyed or damaged to an extent of 75% or more of its value the land upon which the building is built shall not thereafter be used otherwise than in conformity with the scheme, and the buildings shall not be repaired or rebuilt, altered or added to for the purpose of being used for a non-conforming use or in a manner or position not permitted by the scheme, unless special approval by council is granted."

12 Dealing first with cl 10.2, the first thing to decide is whether it constitutes a prohibition within the meaning of s 12(2a)(b)(ii). If it does not, the effect of the leading part of s 12(2a)(b)(ii) is that the land "shall not be deemed to be injuriously affected by reason of" that provision. In my opinion, cl 10.2 is not a prohibition, notwithstanding the imperative words "shall not". The effect of the clause as a whole is not to prohibit the activities referred to, but to require planning consent to be obtained with respect to them. To require planning consent to be obtained with respect to building works and to prescribe conditions that are to apply to works and to empower the council to attach conditions to the consent to carry out the works is not to "prohibit" the activity within the meaning of the subsection. The word "prohibits" in s 12(2a)(b)(ii) must take its meaning from its context. In the context of town planning, there are many things for which licences and consents are required. Such activities would not normally be described by people using ordinary language in a town planning context as "prohibited".

13 Reference may be made to cl 2.1.1 of the scheme which provides:

"Except as hereinafter provided, no development shall be carried out on land within the scheme area without the prior consent of the council. Such consent is hereinafter referred to as 'planning consent' and is required prior to and in addition to the issue of a building licence."

14 There then follow numerous provisions with respect to the granting of planning consent. Clause 2.4.2 provides:

"The council, having regard to any matter which it is required by the scheme to consider, to the purpose for which the land is zoned or approved for use under the scheme, to the purpose for which land in the locality is used, and to the orderly and proper planning of the locality and the preservation of the amenities of the locality, including land designated as a place of heritage significance, may refuse to approve any application for planning consent or may grant its approval unconditionally or subject to such conditions as it thinks fit."

15 It can hardly be suggested that these provisions mean that all development in the scheme area is "prohibited".

16 In my opinion, the purpose of cl 10.2 is not to prohibit non-conforming use, but to make applicable to non-conforming uses the general requirements of the scheme as regards planning consent and, in addition, by cl 10.2(d), to empower the council to require compliance with such other requirements as it may think necessary to secure the amenity, health or convenience of the area because the use is a non-conforming use. For example, if a non-conforming industrial use was being carried on in an area which the scheme zoned residential, the council might wish to (and by cl 10.2(d) it would have the power to) impose stricter requirements to obviate potential nuisances such as noise and dust than would be applicable to that same use if carried on in an industrial area.

17 As to cl 10.5, it was submitted by Mr Beech, on behalf of the appellant, that this clause means that if any one of several buildings not in conformity with the scheme should be destroyed, or damaged to the specified extent, none of the buildings on the lot may be repaired or rebuilt, altered or added to without special approval and none of the land on which the non-conforming use was being carried on may thereafter be used otherwise than in conformity with the scheme, without the special approval of council. In other words, it was submitted that cl 10.5 extinguished all non-conforming use rights in respect of the whole parcel of land in the event that any one building on the land was destroyed or damaged to the specified extent. I do not think cl 10.5 has this meaning. It is true that the first part of the clause refers to "building" in the singular and the second part refers to "buildings" in the plural, but, in my opinion, the clause is intended to impose restrictions only with respect to the destroyed or damaged buildings themselves and only with respect to that part of the land actually occupied by that or those damaged or destroyed buildings. The phrase "the buildings shall not be repaired or rebuilt ... ", etcetera, clearly refers to buildings "destroyed or damaged".

18 The second and I think the main point made by Mr Beech is that even if the above construction for which he contends is not accepted, still the clause plainly amounts to a prohibition which does prohibit "wholly or partially the continuance of any non-conforming use" and "the erection, alteration or extension on the land of (buildings) in connection with or in furtherance of, any non-conforming use of the land" within the meaning of s 12(2a)(b)(ii).

19 As to this submission, the first question is whether cl 10.5 does, in terms, constitute a prohibition, having regard for the discretion conferred on council in the last seven words of cl 10.5 to grant "special approval" in respect of the prohibited activities. On behalf of the respondent, Mr Skinner submitted that in the same way that the discretion to grant planning consent has the consequence that the provisions of cl 10.2 of the scheme cannot be regarded as a prohibition, so the discretion in council to grant special approval to the prohibited activities denoted in cl 10.5 has the consequence that that clause cannot be regarded as a prohibition.

20 In my opinion, cl 10.5 is rather different from cl 10.2. Whereas the purpose of cl 10.2 is to bring non-conforming user into conformity with uses which are not non-conforming uses as regards the need for planning consent so that the clause cannot be regarded as a prohibition, cl 10.5 is, I think, intended to be a prohibition. The fact that the council may "by special approval" grant a dispensation from the prohibition does not matter. The concept of "special approval" is not defined in the scheme, but it suggests that approval may be given only in exceptional cases. The general effect of the provision is therefore to work a prohibition. There is a clear distinction between such a clause and a clause which requires planning consent to be obtained. In the latter case, planning consent could only be refused on proper planning grounds. In the former case, the activity stands prohibited unless it is a special case.

21 The next thing to decide is whether the prohibition contained in cl 10.5 is within s 12(2a)(b)(ii) in light of its conditional and prospective nature.

22 The learned trial Judge held that the presence of cl 10.5 in the scheme did not mean that the scheme "prohibits wholly or partially the continuance of any non-conforming use of that land" within the meaning of the first 13 words of s 12(2a)(b)(ii). As I understand his reasons, this was mainly because of the conditional nature of the prohibition. He held that cl 10.5 is concerned with, as he put it at page 10 of his judgment:

" ... what is effectively the termination of a non-conforming use or its discontinuance, and in general terms prohibits resumption. That is quite a different situation from the case of a provision of a town planning scheme which, when it comes into force, prohibits wholly or partially the continuance of the non-conforming use. The coming into operation of this scheme does not have that effect."

"His Honour erred in law in holding that cl 10.5 of the scheme did not come within the operation of s 12(2a)(b)(ii). His Honour should have found that cl 10.5 partially prohibited the continuance of a non-conforming use of the land and, alternatively, partially prohibited the erection, alteration or extension of buildings used in connection with a non-conforming use of land."

24 In my opinion, this ground of appeal must be upheld.

25 It is true that the coming into operation of the scheme did not then and there prevent the continuance of the appellant's non-conforming use. In fact, as Murray J pointed out, cl 10.1(a) is in terms which expressly permits the continuance of non-conforming uses. Clause 10.1 provides:

(a) the continued use of any land or building for the purpose for which it was being lawfully used at the time of coming into force of the scheme ... "

26 However, with respect, I do not understand s 12(2a)(b)(ii) to be concerned only with prohibitions which have the effect of immediately stopping a present use. A clause which purported to stop non-conforming use prospectively by prohibiting it, say, after two years from the coming into operation of the scheme would be a prohibition on the continuance of non-conforming use, as a matter of ordinary language.

27 If it is correct to say that a prohibition on the continuance of a non-conforming use after a date in the future is a prohibition within the ambit of s 12(2a)(b)(ii), I think a prohibition which comes into effect on the happening of certain events (such as destruction of or damage to buildings) is just as much a prohibition within the ambit of the subsection. The prohibition is immediate in the sense that as a prohibition it has legal effect from the making of the scheme, although, of course, the circumstances in which it will apply may not arise for some time, if ever.

28 In my opinion, cl 10.5 is within s 12(2a)(b)(ii) in that it does prohibit wholly or partially the continuance of any non-conforming use of the land and the erection, alteration or extension on the land of buildings in connection with or in furtherance of the non-conforming use of the land.

29 Of course, the quantification of the injurious affection is another matter, with which we are not concerned in this appeal.

30 Mr Skinner submitted that if cl 10.5 was a prohibition within the ambit of s 12(2a)(b)(ii), then by operation of s 12(2a)(c) it should not be regarded as having the effect of prohibiting the erection, alteration or extension of any building on the land. This subsection is set out above. I am not able to accept this submission. In considering the effect of cl 10.5, there is no room for the operation of s 12(2a)(c). Clause 10.5 of the scheme does not "prescribe any requirement to be complied with" and is not therefore a provision to which the subsection refers. In my opinion, s 12(2a)(c) is intended to make it clear that provisions in the scheme of general operation with respect to classes and kinds of building are to be put to one side in considering whether any provision of the scheme is within s 12(2a)(b)(ii). It means that if the making of a scheme results in a use becoming a non-conforming use, the landowner does not get compensation for injurious affection on the ground that there is a restrictive provision in the scheme which affects his building, if the restrictive provision is one which applies to all buildings of the class or kind in the scheme area.

31 I would allow the appeal and order that Question 1 should be answered "Yes".

32 OWEN J: I have read the reasons to be published by Anderson J. I agree with them and his Honour's conclusions. I have nothing further to add.