Winten Property Group v Campbelltown City Council

Annexure E to Mr Green's affidavit is the Draft Community Management Statement for what is proposed to be called " Meehan's Retreat Community Scheme ". Counsel for the applicant has drawn the Court's attention to Part I entitled " By-laws fixing details of development ": These by-laws relate to the control and preservation of the essence or theme of the community scheme and as such may only be amended or revoked by a unanimous resolution of the community association (See section 17(2) Community Land Management Act 1989). BY LAW 1 DEVELOPMENT THEME 1.1 Meehan's Retreat will be a secure, fully masterplanned integrated development of linked accommodation, home business and recreational facilities. The accommodation on all lots will also be used in conjunction with agriculture, ancillary buildings, a community club house/place of assembly which will contain a gymnasium, snooker table, table tennis and space for such things as aerobic classes, drainage works, roads and utility installations, landscaping works involving the planting of trees and shrubs, recreational areas particularly golf, tennis, playground, cycling, walking and passive recreation. 1.2 The Community Association will govern the Retreat and all uses within the Retreat in accordance with physical and social parameters being these By-Laws which ensure that these uses and the essential aspects of the environment are retained. Members of the Community Association who will be lot owners will make the financial contributions towards maintenance of the Retreat and of its extensive facilities and services. Membership of the Community Association is mandatory for all landholders. 1.3 An area somewhat less than half of the land comprising the Retreat will be devoted to low density neighbourhood lots the accommodation on which will be used in conjunction with uses set out in paragraph 1.1 within the Retreat both on community property and elsewhere. 1.4 The rural lots on other areas of the Retreat may be used for agriculture in conjunction with accommodation. 1.5 All lots will be planted with trees and shrubs for landscaping. All dwellings may be used for home offices. 1.6 The accommodation lots will be functionally and physically linked to other contemplated land uses within the Retreat through the creation of substantial landholdings and landuses on community land within the Retreat (the community land is approximately equal to the size of the area proposed for private accommodation), the accommodation will be linked in perpetuity to other uses by the mandatory formation of a Community Association with the membership of all residents. Uses proposed on common land which all residents will share in are:

• agriculture (including agistment of animals on drainage lands to keep the grass down),
• buildings required to accommodate activities ancillary to other permissible purposes (including storage of maintenance and groundkeeping machinery, and security and gatehouse buildings),
• a clubhouse for the pursual of common sporting, social and cultural interests (called the community clubhouse),
• drainage (including the retention basin and stormwater lines),
• planting of trees (for landscaping and visual screening),
• recreation areas (for golf, tennis, playground, cycling, walking, exercise, and passive overlooking),
• recreation facilities (within the clubhouse including a gymnasium, snooker table, table tennis, and aerobic activities),
• roads (for the secure and exclusive passage of residents to their homes from Campbelltown Road and between their homes and facilities which are in their shared ownership), and
• utility installations (including a sewer pumping station and reticulation mains, water supply, irrigation lines to common areas, and security telecommunication lines to the gatehouse).

The document goes on to indicate that approximately 12 ha of the retreat will be devoted to a " landscape community recreation area to enhance the permanent outlook of private residences and facilitate active community uses …". Approximately 10 ha of the retreat will be used for a private road network etc., 15 ha will be set aside primarily for drainage retention purposes, and 6 ha provided for Macquarie Field House and its curtilage (for exclusive use by its owners).

A Draft Community Scheme was prepared by the applicant, and Mr Green's affidavit suggests " the applicant would propose [it] be incorporated in any consent by the Court ". The applicant reserves the right to amend the Draft Community Scheme once it receives the particulars requested in a letter (also annexed to the affidavit) with respect to the permissibility issue. That letter is dated 22 July 1999 and seeks an outline of the basis upon which the Council claims the development application is not permissible. The letter enclosed a draft set of facts which the affidavit states included the annexures.

The relevant planning instruments are Campbelltown Local Environmental Plan (" LEP ") 112 and Campbelltown LEP 135.

Campbelltown LEP No.112 - Macquarie Field House was gazetted on 18 January 1991. It amended the relevant local Interim Development Order to provide that it no longer applied to the land covered by the plan, it was amended by LEP No.135 on 31 January 1992. LEP 112 did not define " dwelling house ", but adopted the model provisions (for all relevant purposes). LEP 135 sought only to define " dwelling house " for the purpose of the development of the land to which LEP 112 applies and inserted the following definition of " dwelling house ": 'dwelling-house' means a building containing one but not more than one dwelling on a neighbourhood lot which is linked in a community scheme to development for other permissible purposes

Other relevant provisions of LEP 112 as it currently stands are as follows.

Clause 2(1) sets out the aim of the plan in terms: …to replace the present zonings of the land to which it applies in order to permit that land to be used as the site for an integrated development incorporating a hotel, convention centres, facilities for executive and staff development, certain types of accommodation and business activities and recreational facilities.

Clause 2(2) sets out eight objectives of the plan including the following: (a) to control the uses to which the land to which this plan applies may be put; (b) to conserve the environmental heritage of the land to which this plan applies; (c) to protect and enhance the role of the land to which this plan applies in providing a clearly perceived break between urban development in the City of Campbelltown and that in the City of Liverpool by preserving the visual character and landscape quality of that land; (d) to protect and enhance the role of the land to which this plan applies in providing a rural backdrop to the residential areas of Glenfield, Macquarie Fields and Ingleburn; (e) to protect the quality and nature of the view from the South Western Freeway where it passes through the land to which this plan applies; (f) to protect that part of the major urban drainage system for the City of Campbelltown situated on the land to which this plan applies; (g) to control, by means of a development control plan, the siting, height, bulk, scale and density of any buildings to be erected on the land to which this plan applies to achieve the objectives stated in paragraphs (c), (d), (e) and (f); and (h) to guide, by means of a development control plan, the future landscaping of the land to which this plan applies to achieve the objectives stated in paragraphs (c), (d), (e) and (f).

Clause 5(2) provides that " in this plan ": (a) a reference to a building or place used for a purpose includes a reference to a building or place intended to be used for the purpose; and (b) a reference to a map is a reference to a map deposited in the office of the council.

Clause 5(1) sets out various definitions. Relevantly " recreation area " is defined to include: (c) an area used to provide facilities for recreational activities which promote the physical, cultural or intellectual welfare of persons within the community, being facilities provided by: (i) a public authority; or (ii) a body of persons associated for the purposes of promoting the physical, cultural or intellectual welfare of persons within the community

" Recreation facility " means: (a) a gymnasium; (b) an indoor swimming pool; (c) a squash court; or (d) any other building of a like character used for indoor recreation, whether used for the purpose of gain or not, but does not include a place of assembly.

Clause 8 provides: Except as otherwise provided in this plan, in respect of the land to which this plan applies: (a) there are no purposes for which development may be carried out without development consent. (b) the purposes for which development may be carried out with development consent are:

• agriculture (other than intensive animal or horticultural husbandry);
• buildings required to accommodate activities ancillary to other permissible purposes;
• clubs;
• dwelling-houses used in conjunction with development for other permissible purposes;
• drainage; …
• places of assembly; …
• recreation areas;
• recreation facilities; …
• residential flat buildings used in conjunction with development for other permissible purposes;
• roads; … (c) development for any other purpose is prohibited.

A person must not subdivide land to which this plan applies except with the consent of the council.

The Council's written submissions draw attention to several sub-paragraphs of SEE s 9. Specific reference is made to the fact that the current application is for subdivision of the land only. In considering a proposed subdivision, a consent authority must, it is submitted, have regard to the intended use of the land when it has been subdivided.

Paragraphs 16 ff of the Council's written submissions state as follows: 16. The proposed use of the land as subdivided for non-residential purposes are ancillary to the use for the purpose of a dwelling house on the great majority of the lots. 17. The development of the land for non-residential purposes cannot be characterised as a use of the land for separate and distinct purpose for which that land will be used. 18. The proper characterisation of the use of the land as subdivided will be for the purpose of dwelling houses, all other uses being ancillary to that use. 19. Consequently, as developed the subdivided land would not be used for the purpose of dwelling houses used in conjunction with development for other permissible purposes. 20. Rather, the land as subdivided will be used for the purpose of dwelling houses as defined which is not itself a permissible use of the land (see Clause 8). 21. In consequence, the granting of the development application would be a futility in that on the true construction of the provisions of LEP 112 the land will not on the facts disclosed in the Statement of Environmental Effects be used for a permissible purpose.

The applicant submits that the proposed integrated development of accommodation and recreational facilities, with the possibility of certain minor business activities, reflects and takes into account the specific provisions of the LEP. While the proposal may need refinement as its consideration continues, the applicant contends that the proposed development post subdivision is " specifically designed to meet the constraints of the site and to blend with the development of the neighbouring 'Monarch' land ", which was formerly (and relevantly at the time of the adoption of the master plan) in common ownership with the subject land. Some 70% of the subject site is to remain " open countryside ".

The applicant contends that many of the uses noted in cl 8 of the LEP are proposed for the subject site and that the development, therefore, is permissible. The use " dwelling houses " as stipulated in cl 8 should be consolidated with the definition of " dwelling house " which appears, by virtue of LEP 135, in cl 5, which would make the relevant use, which is permissible with consent, the following: a building containing one but not more than one dwelling on a neighbourhood lot which is linked in a community scheme to development for other permissible purposes used in conjunction with development for other permissible purposes.

The requirement that the building be " linked " is in effect no different from the requirement that it be " used in conjunction with … other permissible purposes ".

The answer to the question of law, therefore, depends upon the characterisation of the development and the correct construction of the term " in conjunction with ".

The Court notes the draftsman's distinction in clause 8(b) of LEP 112 between the terms " ancillary to other permissible purposes " and " in conjunction with development for other permissible purposes ".

The classic statement of the law on characterisation is that of Glass JA in Foodbarn Pty Ltd & Ors v Solicitor General (1975) 32 LGRA 157 at 161: … where a part of the premises is used for a purpose which is subordinate to the purpose which inspires the use of another part, it is legitimate to disregard the former and to treat the dominant purpose as that for which the whole is being used. Doubtless the same principle would apply where the dominant and servient purposes both relate to the whole and not to separate parts. But the trial judge specifically found that sales by retail were not ancillary to other purposes of the defendants and no attempt has been made to subvert that conclusion. Where the whole of the premises is used for two or more purposes none of which subserves the others, it is, in my opinion, irrelevant to inquire which of the multiple purposes is dominant. If any one purpose operating in a way which is independent and not merely incidental to other purposes is prohibited, it is immaterial that it may be overshadowed by the others whether in terms of income generated, space occupied or ratio of staff engaged.

Counsel for both parties in these proceedings referred to the same three cases in this Court on the construction of the term " in conjunction with ".

The Court of Appeal decision in Legal & General Life of Australia Ltd v North Sydney Municipal Council & Anor (1990) 69 LGRA 201 precedes those three cases and the following passage of the judgment of Priestley JA (at 206-207) is pertinent: The remaining two business zonings (the two business neighbourhood zonings) both speak of dwelling-houses and residential flat buildings 'attached' in the one case to shops or development for Schedule 6 purposes and in the other case to shops, commercial premises, commercial office space or Schedule 6 purposes. The word 'attached' where here used seems to me to be appropriate to convey the idea which counsel for L & G was submitting was conveyed by the words 'in conjunction with' in regard to the other seven business zonings. If I am right in this, then the difference in language is significant, and when to this consideration there is added the necessity not merely to consider the meaning of the words 'in conjunction with' but the word 'constructed' preceding that phrase, then I have little doubt that the words 'constructed in conjunction with' appearing in the enumerated purposes of the business commercial (restricted) zoning are best understood as having the general effect of 'constructed together with' , that is, physically, and not, as L & G would submit, 'constructed for use in association with the use of commercial premises as such'. This conclusion is reinforced by the description of the purposes enumerated in regard to the industrial light zoning. The words 'dwelling-houses used in conjunction with industry and situated on the same land as the industry' quite clearly exclude dwelling-houses owned or tenanted by residents unconnected with a specific industry on specific land. If what L & G contends for in regard to the business commercial (restricted) zoning had been intended by the draftsman of cl 9, a form of words along the lines of those used in regard to the industrial light zoning could quite easily have been written.

In Sweeney Pastoral Company v Snowy River Shire Council [1993] NSWLEC 189 the question of permissibility turned upon cl 44(2) of the Kosciusko Regional Environmental Plan.

Clause 44(2) provided: The Council may consent to the carrying out of development (other than subdivision) for the purpose of providing accommodation for tourists, where the council is satisfied that any accommodation is provided in conjunction with the use of the land for the purpose of agriculture.

The Chief Judge said that the clause must be interpreted keeping in mind the objectives of that part of the Regional Plan in which it appears. The Chief Judge surveyed the competing arguments put by Counsel in the matter at some length and then concluded (at 9): In my opinion, the phrase 'in conjunction with' connotes a connection or relationship or association, a quality which it is convenient to refer to as a 'nexus' . In cl 44(2), the phrase requires a nexus between, on the one hand, the tourist accommodation to be provided, and on the other hand, the use for agriculture. In the context of the clause in question, that nexus is not demonstrated by mere physical location or by the fact that these are both 'economic activities' . The clause requires the nexus to be between two uses. It is a question of function and accordingly, it is a functional nexus which is required.

That same quality of connection, relationship or association also applies, in my opinion, to cl 38(b), where the identical phrase is used. Therefore, the objective which cl 38(b) enunciates also involves a functional nexus between on-farm accommodation for tourists and the farming of a property.

Mr Marks submitted that the word 'agriculture' as used in the clause, should be read down, as seems to have been done by the Assessor, so that it involves a question of the scale and degree of the agricultural use. I agree with this submission. If there is required to be a functional nexus between the accommodation use and the agricultural use, then each use must be, in comparison, of such size as to make that nexus feasible. Clearly this involves weighing up both the size and intensity of the agricultural use and the size of the tourist accommodation proposed. The Assessor was correct in holding that in order to fall within cl 44(2) the accommodation use on the subject land must be of a scale and degree commensurate with the agricultural use.

In Parsons & Anor v Hornsby Council [1995] LEC 69 Stein J dealt with a provision in the Hornsby LEP which he construed to mean that shops, defined to include hiring and well as selling, were permissible only if " ancillary to or used in conjunction with other development permissible in this zone which serve the daily convenience needs of the workforce within this zone ".

His Honour considered the construction of the phrase " in conjunction with ", and adopted the reasoning of the Chief Judge in Sweeney in the following terms (at 8): Although, as I have said, the context and the clause are different, I would respectfully adopt Her Honour's interpretation of the subject clause in the table of permissible uses in the Hornsby LEP. A nexus or association needs to be demonstrated between the uses - the one permissible and the other not. Mere physical location or proximity is of itself not enough. There needs to be a functional nexus between the uses. An example might be a cinema (permissible as an entertainment facility) and a car park to service it. Mr McEwen suggested an agricultural use and a produce store. In both examples there is a functional nexus. Not so between a video store and McDonalds or KFC. In this respect the relationship is purely one of mutual economic support of each others distinct goods and services by joint promotions. This may be convenient and profitable but it does not provide a sufficient functional nexus to satisfy the requirements of permissibility in the Table….

However, I do not think that the respective uses need to be interdependent nor the association necessarily a close one. In my opinion, there is a sufficient functional nexus between the uses. It is more than mere convenience, more than mere physical location, more than both activities being economic in nature and more than conjoint sales. There is, in my view, a sufficient association or relationship between the uses to qualify under the phrase.

The same provision of the Hornsby LEP 1994 came before the Court again in Loccisano v Hornsby Shire Council [1996] NSWLEC 12, in which the Chief Judge said:

A number of uses are permissible with council consent in that zone, including warehouses and distribution centres. It also includes 'shops ancillary to or used in conjunction with other development permissible in this zone or which serve the daily convenience needs of the workforce within this zone' …

What appears at once as being the critical issue in this case is whether the retail sale of footwear to the public from these premises is use as a shop which is permissible within the Business E (Service Centre) zone. There are, as the zoning table sets out, three possibilities. Either the use is ancillary to the permitted use, or it is a use 'in conjunction with' the permitted use, or it is a use which serves the daily convenience needs of the workforce within the zone. The case put for the applicant is that the retail use of these premises is 'in conjunction with' the wholesale use.

The Chief Judge reviewed her decision in Sweeney and the decision of Stein J in Parsons , and turned her attention to the facts of the case so far as warehouse and retail use were concerned. The Chief Judge said:

The warehouse and retail uses both take place within the same structure, and they both use the facilities which are in that structure, namely the loading dock, the telephone, the office areas, the counter areas and the display areas. There is no distinction in the goods which are sold; they are the same, whether they are sold by wholesale or by retail. The same staff are engaged in the sale of the goods. The ordering is the same as the same deliveries of stock to the premises are made in order to satisfy the wholesale or the retail use. There really is no fundamental distinction between the use of the ground floor and the mezzanine floor, except that members of the public would not find it necessary or be required to go to the mezzanine level whereas trade users or wholesale users are more likely to do so. As Mr Hawkes said, on behalf of the applicant, the uses or activities are inextricably entwined.

Mr McEwen, for the council, pointed out however, that there is one distinction between the activities of wholesale and retail which take place in these premises. That is that the persons who have the benefit of the uses are not the same. He submitted that there must be a relationship between the uses and the persons who take the benefit of the uses. His submission was that if there is no similarity or if they are not the same, that is, the persons who take the benefit of the uses which take place in the premises, then there is no functional nexus. His submission was that it is not sufficient to be 'in conjunction with' if the operation sells by retail what the operation sells by wholesale.

I recognise that there is a distinction in the customers who come to the premises between those who come for the wholesale use and those who come for the retail activity, but I think that is only one factor in determining whether the retail use is 'in conjunction with' the wholesale use. That is the only distinguishing factor, whereas everything else about the uses are exactly the same. It seems to me therefore that, where there is that similarity or identity of all the things that take place in the two activities, that they are in conjunction with one another. Therefore I hold that the retail use on the premises is permissible within the terms of the zoning because it is a shop use 'in conjunction with' a use of the premises as a warehouse and distribution centre.

From those authorities Mr Austin QC, on behalf of the applicant, deduced the following five propositions:

1. There must be a relevant nexus between the two purposes. 2. That nexus is not achieved by mere physical location on the land, the subject of the application or by the fact that both are 'economic activities' . 3. There must be a functional nexus. 4. Each use must be, in comparison, of sufficient size as to make the nexus feasible. 5. The uses do not however, need to be interdependent nor the association necessarily a close one.

He went on to argue that there will be in this case 171 buildings, each containing one, but not more than one, dwelling. Each such building will be on a neighbourhood lot. They will all be linked in a community scheme to the other permissible developments, namely, agriculture, ancillary buildings, clubs, drainage, landscaping, recreation areas and facilities, roads and utility installations, and the dwellings will also be used in conjunction with those other uses.

Mr Austin argues that there " is a relevant nexus between all the proposed uses and the dwelling houses ", and, in fact, so much so that the uses will be interdependent.

In applying the relevant passage from Loccisano Mr Austin suggests that the word " scheme " be read for the word " structure ". The uses are as a consequence inextricably entwined as required by the management plan. Dwelling house uses are not specifically permissible unless contained within a community scheme. Whether in other circumstances or in other planning instruments some of the expressly and separately defined cl 8 uses would be ancillary to or subsumed in, other uses is beside the point. Clause 8 specifically identified separately those uses for the purposes of definition and permissibility.

Mr Austin submits that cl 8 must be given only its literal meaning. Neither the context nor the words themselves throw any doubt upon that meaning and the literal meaning is the ordinary meaning. He submits that the Council's argument requires the Court to ignore the plain words of cl 8 and substitute or add as a test the question whether the proposed permissible uses other than residential accommodation are or are not ancillary to that residential use.

Mr Austin submits that the Council's argument is circular and could lead to a nonsense. If, for example, development consent were granted for roads, an argument could be mounted against a later application for approval of dwelling houses that the clause requires that such houses must be intended to be used only in conjunction with those roads.

Clause 8 may be an unusual provision in its definition of " dwelling house " but there is no doubt or ambiguity in the clause or in the interpretation for which the applicant contends. The clause draws a specific distinction between ancillary uses and those which might be " in conjunction with " other uses. Hence the only thing required is that the use of the dwelling house be linked to, or that its use must be in conjunction with, one of the other uses nominated in the clause. As it is proposed that they will be linked to or used in conjunction with a number of other separately defined uses, the application is permissible. The scheme of the LEP post-1991 is to impose restrictions on dwelling house development and require community title subdivision. The applicant's proposal complies with that constraint. The drafting recognised the need for ancillary uses to be specifically accommodated.

I accept the submissions of the applicant and conclude that the proposed development which will follow the subdivision makes the subdivision permissible. I answer the question of law (par 3) in the affirmative.

I grant leave to the parties to approach the Registrar forthwith to fix the substantive matter for hearing.

There will be no order as to costs, and all exhibits may be returned.

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