Zhiva Living Dural Pty Limited v Hornsby Shire Council

Leave to appeal is sought

1. As Zhiva had appealed under s 56A of the Court Act, leave of this Court is needed to appeal against the decision and order of the judge on the appeal under s 56A: see s 57(4)(c) of the Court Act. The rationale for requiring leave of this Court is that there has already been one opportunity for an appeal against the decision or order of the commissioner on questions of law (the s 56A appeal) and justification needs to be supplied to permit a second opportunity to appeal against the decision or order of the commissioner on questions of law. Certainly, the mere fact that the question sought to be agitated in the appeal to this Court, if leave were to be granted, is a question of law is insufficient of itself to justify leave being granted; something more is required: Huang v Hurstville City Council [2012] NSWCA 17 at [9].
2. In this case, however, Zhiva does not seek to re-agitate any question of law that it had raised on the s 56A appeal against the commissioner's decision. Instead, Zhiva seeks leave to appeal against the judge's decision and order on a question of law, being the judge's denial of procedural fairness in deciding the s 56A appeal on grounds not raised by Zhiva and in respect of which Zhiva did not have an opportunity to be heard. A failure to afford procedural fairness to a party is an error of law: Warkworth Mining Ltd v Bulga Milbrodale Progress Association Inc (2014) 200 LGERA 375; [2014] NSWCA 105 at [5], [38]. Where a court determines a matter on a basis that was not in issue or argued in the proceedings, there will have been a denial of procedural fairness: at [40]. Such an error of law affects the decision of the judge from which the appeal is brought: Murlan Consulting Pty Ltd v Ku-ring-gai Municipal Council (2009) 170 LGERA 162; [2009] NSWCA 300 at [37]. This is because, by denying procedural fairness, there is legal error in the manner in which the judge determined the matter: Warkworth Mining Ltd v Bulga Milbrodale Progress Association Inc at [4].
3. In these circumstances, Zhiva has not yet had an opportunity to appeal against the judge's decision on a question of law. This justifies the grant of leave to appeal.

Grounds of appeal

1. Zhiva raises five grounds of appeal in its amended draft notice of appeal dated 10 June 2020. Grounds 1 and 2 are that the judge denied Zhiva procedural fairness in determining the question of whether the commissioner had power to determine the second application to issue a site compatibility certificate and in determining that the second application for a site compatibility certificate had been made but not significantly progressed, which caused the development application not to be a valid application. Grounds 3 and 4 concerned the judge's determination of two aspects of the question of whether the commissioner had power to determine the second application for a site compatibility certificate. The first aspect was that the body whose power was being exercised by the commissioner in relation to the development application was Hornsby Shire Council rather than Sydney North Planning Panel. The second aspect was that the relevant panel whose power the Court was exercising on appeal was derived from s 2.15(b) of the EPA Act rather than s 2.15(a). Ground 5 was that the judge erred in law in finding that there was no utility in remitting the proceedings to a commissioner for determination despite the appeal having been upheld.
2. Zhiva had earlier raised a sixth ground of appeal concerning the judge's determination that the commissioner had no power under s 39(2) of the Court Act to determine the second application for a site compatibility certificate. That ground of appeal was deleted in the amended draft notice of appeal dated 10 June 2020. The reason was that the relevant panel, Sydney North Planning Panel, approved on 16 April 2020 Zhiva's application for a new site compatibility certificate. This was the second application for a site compatibility certificate that had been lodged before the first site compatibility certificate lapsed and had been pending at the time of both the appeal before the commissioner and the s 56A appeal before the judge. As a result of Sydney North Planning Panel issuing the new site compatibility certificate, the question of whether the commissioner has the power to determine an application for a site compatibility certificate is no longer relevant, either for the purpose of the appeal to this Court, or if the matter be remitted to the Court below, to the proceedings before either the commissioner or the judge.
3. Zhiva seeks leave to adduce further evidence on the appeal, if leave to appeal were to be granted, of the issue of the new site compatibility certificate on 16 April 2020. Zhiva submitted that evidence of the issue of the site compatibility certificate is relevant to the question of remitter of the matter if the appeal is upheld by this Court. Zhiva submitted that the issue of the site compatibility certificate supports remitter to the commissioner, rather than the judge. The judge's conclusion on the lack of utility of remitting the matter to the commissioner was based on the absence of a current site compatibility certificate. That omission has been remedied by the issue of the new site compatibility certificate.
4. The Council did not oppose leave being granted to Zhiva to rely on this further evidence concerning the issue of the new site compatibility certificate.
5. Although there may be a question of whether the source of the Court's power to admit fresh evidence on an appeal under s 57 of the Court Act lies in s 75A(7) of the Supreme Court Act 1970 or elsewhere, in circumstances where there is no opposition to the Court receiving the further evidence and its potential relevance to the terms of the remitter order this Court should make, I consider leave should be granted to Zhiva to adduce the further evidence concerning the issue of the new site compatibility certificate. This further evidence is paragraphs 15 and 16 of Mr Sonter's affidavit of 1 May 2020 and Annexure A being the site compatibility certificate dated 16 April 2020.
6. The issue of the new site compatibility certificate also meant that Zhiva did not need to, and did not in fact, press grounds 3 and 4 of the draft notice of appeal. As earlier noted, grounds 3 and 4 concerned two aspects of the question of whether the commissioner had power under s 39(2) to determine the second application for a site compatibility certificate. These grounds are no longer relevant.
7. Instead, Zhiva focused on grounds 1 and 2 concerning the judge's denial of procedural fairness and ground 5 concerning the judge's decision not to remit the matter to the commissioner.

Zhiva's argument that the judge erred in law

1. In relation to grounds 1 and 2, Zhiva noted that the judge gave two reasons for his conclusion that there was no utility in remitting the matter to the commissioner. The first was that the commissioner had no power under s 39(2) of the Court Act to determine the pending application for a site compatibility certificate by the issue of a fresh site compatibility certificate (at [63]). The second was that because the application for a new site compatibility certificate had not been significantly progressed, there was no valid development application capable of being remitted to the commissioner and to which the commissioner could grant consent (at [65]). Zhiva submitted that neither of these reasons concerned issues raised in the grounds for appeal, set out in the amended summons commencing the s 56A appeal, or joined between the parties on the appeal. The jurisdiction of the judge in determining the s 56A appeal was limited to the issues in the grounds of appeal or joined between the parties. The Council had filed a submitting appearance and did not take an active role during the s 56A appeal (Applicant's summary of argument, [13]-[15]).
2. The judge did not bring to Zhiva's attention his intention to deal with these critical issues on which his decision to refuse to remit the matter to the commissioner was likely to turn, and in fact did turn, so that Zhiva had an opportunity to deal with them: Kioa v West (1985) 159 CLR 550 at 587; [1985] HCA 81. If the judge intended to determine the proceedings by reference to matters going beyond the issues identified by the parties, procedural fairness required that the parties be given notice of these additional matters and afforded the opportunity to be heard on them: Botany Bay City Council v Pet Carriers International Pty Ltd (2013) 201 LGERA 116; [2013] NSWLEC 147 at [101]. (Applicant's summary of argument, [17]-[18]).
3. Zhiva submitted that the judge did not give such notice or afford procedural fairness to the parties. Although the question of the utility of remitting the matter to the commissioner was discussed in general terms in closing submissions, the judge did not give notice that he would determine either of the issues of whether the commissioner had power under s 39(2) of the Court Act to issue the site compatibility certificate or whether, by reason of there being no current site compatibility certificate, there was no valid development application. (Applicant's summary of argument, [22]-[23]). Zhiva submitted: "The transcript of the hearing before the primary judge discloses that his Honour was proceeding on the basis that the Applicant simply needed to satisfy the Court as to the 'potentiality of there being utility in sending the matter back to the Commissioner', which was 'not a matter for me today' and which did not even require the Applicant to demonstrate an 'arguable case'. Although there was then discussion as to the status SCC application, his Honour did not demur from the ultimate submission put to him, namely that there was at least potential utility in a remitter at the time of the hearing before the primary judge, whether on the basis that in the meantime the Panel had determined the second SCC application or on the basis that the Commissioner had the power to issue the SCC himself under s 39(2) of the LEC Act. The primary judge did not express any intention to determine the development application himself on the basis of the absence of the SCC. To the contrary, his Honour expressly said there was no suggestion in this case that he would do so. That is a denial of procedural fairness sufficient to vitiate his Honour's decision." (Applicant's submissions in reply, [24]-[25]).
4. Zhiva submitted that, in light of the new site compatibility certificate having been issued, there is now utility in remitting the proceedings to the Land and Environment Court for determination of Zhiva's development application. The site compatibility certificate authorises the proposed seniors housing development, which otherwise would have been prohibited on the site (Applicant's submissions in reply, [26]).
5. In relation to ground 5, Zhiva identified three errors of law in the judge's decision not to remit the matter to the commissioner. The first error arises from the judge's assessment of the status of the application for a site compatibility certificate and the validity of the development application "at the time of the hearing of this appeal" (at [65]). The judge concluded that because the first site compatibility certificate had lapsed and the application for a further site compatibility certificate had not been "significantly progressed", there was an absence of a current site compatibility certificate. This had the consequence that there was "no valid application capable of being remitted to the commissioner (at [65]).
6. Zhiva submitted this finding involved the judge asking himself the wrong question, misconstruing the Seniors SEPP and making a manifestly unreasonable decision. Clauses 24 and 25 of the Seniors SEPP enable development consent to be granted to a development application for seniors housing development on land on which that kind of development is otherwise prohibited, if the development application is one to which cl 24 applies (cl 24(1)) and the relevant panel has certified, in a current site compatibility certificate issued under cl 25, the matters in cl 24(2). The jurisdictional precondition in cl 24(2) to granting consent to a development application to which cl 24 applies only operates as a prohibition at the time that the consent authority determines the development application to grant consent. It is at that time that there needs to be a current site compatibility certificate.
7. Zhiva submitted that the judge erred in assessing whether the jurisdictional precondition was met at a different time, "at the time of the hearing of this appeal." The judge found that because, at the time of the hearing of the appeal, there was no "current site compatibility certificate", there was no valid development application to which development consent could be granted. This involved asking the wrong question and misconstruing cl 24 of the Seniors SEPP.
8. Zhiva also submitted that the judge's decision was manifestly unreasonable. Zhiva referred to the order for remitter to a commissioner made in a recent s 56A appeal in Ballina Shire Council v Palm Lake Works Pty Ltd [2020] NSWLEC 41 at [134], [135]. There too, the issue arose as to whether there was utility in remitting the matter to the commissioner in circumstances where the site compatibility certificate had lapsed. Application for a fresh site compatibility certificate had not yet been made but could be made. I decided that remitter was still appropriate, as application for a site compatibility certificate could be made and the further hearing of the appeal on the remitter adjourned to await the determination of that application (at [135]). Zhiva submitted that the justification for remitter is even stronger where, as in the present case, application for a site compatibility certificate had been lodged and was awaiting determination. Zhiva submitted that in these circumstances, the judge's decision not to remit was manifestly unreasonable.
9. The second error arises from the judge's finding in [67] that there was "no utility" in remitting the matter to the commissioner. Zhiva submitted that this finding was manifestly unreasonable in circumstances where an application for a site compatibility certificate had been made and was awaiting determination by the relevant panel.
10. The third error was the denial of procedural fairness in the judge deciding that there was no utility in remitting the proceedings to the commissioner. Zhiva relied on the ways in which it had contended the judge had denied procedural fairness in grounds 1 and 2.

The Council's non-opposition to leave to appeal and the appeal

1. As earlier indicated, the Council modified its position on whether leave to appeal should be granted by this Court so that it neither consented to nor opposed the application for leave to appeal being granted. The Council also neither consented to nor opposed the appeal to this Court being upheld. The Council's sole contention was whether, if Zhiva's appeal were to be upheld, the matter should be remitted to the judge who heard the s 56A appeal for determination in accordance with the decision of this Court (which was the Council's position) or to the commissioner who heard the appeal concerning Zhiva's development application for the proposed seniors housing development (which was Zhiva's position).

The judge erred in law

1. I consider that the judge did deny Zhiva procedural fairness in determining not to remit the proceedings to the commissioner but instead to determine Zhiva's development application by refusing consent. The judge gave two reasons for his determination. The first was that the commissioner had no power under s 39(2) of the Court Act to determine the second application for a site compatibility certificate. The second was that, in the absence of a current site compatibility certificate, there was no valid development application to which the commissioner could grant development consent. Neither of these reasons concerned a matter raised as an issue on the s 56A appeal.
2. Although the parties had made competing submissions to the commissioner regarding his power to determine the pending application for a new site compatibility certificate, the commissioner did not need to, and in fact did not, decide the issue as he dismissed Zhiva's appeal for the different reason of non-satisfaction of cl 55 of the Seniors SEPP. The grounds of the s 56A appeal only concerned the commissioner's determination of this issue of cl 55 of the Seniors SEPP. No issue was raised on the s 56A appeal regarding the power of the commissioner to issue a new site compatibility certificate.
3. The question of whether the development application for the proposed seniors housing was a valid application in the absence of a current site compatibility certificate was not raised before the commissioner. At the hearing before the commissioner there still was a current site compatibility certificate. That certificate did not lapse until two days after the commissioner delivered his judgment. By the time of the s 56A appeal, the certificate had lapsed. However, application had already been made for a new site compatibility certificate and that application was pending at the time the judge heard and disposed of the s 56A appeal. No issue was raised in the grounds of appeal or during the conduct of the s 56A appeal concerning whether the lapsing of the first site compatibility certificate caused the development application to no longer be a valid application.
4. As a consequence, the judge had no jurisdiction on the s 56A appeal to determine these two issues. The jurisdictional requirement that an appeal against an order or decision of the Court be on a question of law not only confines the ambit of the appeal to a question of law (although this can include a mixed question of law and fact) but also limits the jurisdiction of the Court on the appeal to only those questions of law raised in the appeal; the appeal is not at large. As I noted in Baron Corporation Pty Limited v Council of the City of Sydney [2019] NSWLEC 61 at [100]: " This is not merely a formality, it is jurisdictional. Identification of a decision on a question of law by the Commissioner is not merely a precondition to the right of appeal under s 56A of the Court Act, it identifies the subject matter of the appeal: Minister Administering Crown Lands Act v Bathurst Local Aboriginal Land Council (2009) 166 LGERA 379; [2009] NSWCA 138 at [195]; Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2009) 168 LGERA 1; [2009] NSWCA 178 at [20]; Dial A Dump Industries Pty Ltd v Roads and Maritime Service (2017) 94 NSWLR 554; [2017] NSWCA 73 at [165]. It is the decision of the Commissioner, not the appeal against the decision, that must be on a question of law: Roads and Traffic Authority of NSW v Peak [2007] NSWCA 66 at [139] and B & L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481; [2008] NSWCA 187 at [70]. The essential first task in an appeal under s 56A of the Court Act is to identify the express or implied decision on a question of law. Without the existence and identification of such a decision, the Court will have no jurisdiction to review the decision of the Commissioner: Edyp v Brazbuild Pty Ltd [2011] NSWCA 218 at [33], [35]. The Court's jurisdiction on an appeal under s 56A of the Court Act is confined to addressing the grounds of appeal challenging the Commissioner's decision on questions of law; it does not extend to addressing errors on questions of law not raised in the grounds of appeal."
5. The judge therefore had no jurisdiction on the s 56A appeal to determine the two issues of the power of the commissioner to issue a site compatibility certificate and the validity of the development application by reason of the absence of a current site compatibility certificate, neither of which was raised in the grounds of appeal. The judge's jurisdiction was limited to determining the four grounds of appeal raised in the summons commencing the s 56A appeal.
6. If, however, the judge were to decide these two issues, he was obliged to afford the parties procedural fairness before doing so. Procedural fairness required that the judge give notice to the parties and afford them an opportunity to be heard in relation to the two issues: Warkworth Mining Ltd v Bulga Milbrodale Progress Association Inc at [40] and see also Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145. The judge did not do so.
7. In relation to the first issue, there was a general discussion about the topic of the power of the commissioner under s 39(2) of the Court Act to determine the pending application for a new site compatibility certificate, but the judge agreed with the course suggested by Zhiva's senior counsel of leaving that issue to be decided by the commissioner on the remitter of the matter to the commissioner, if the relevant panel had not first determined the pending application for a site compatibility certificate. The judge accepted that it was "for him [the commissioner] then to determine if that's the case" that he had power under s 39(2) of the Court Act to issue the site compatibility certificate, and that "it's not a matter for me today". The judge later suggested that there were two alternatives: either that he should "deal with the s 39 argument now" or he should reserve, on the basis of what Zhiva's senior counsel had put so far and await the outcome of the second site compatibility certificate application. Zhiva's senior counsel submitted that the judge should adopt the second alternative. The judge agreed and accordingly reserved his decision.
8. At no time during the hearing of the s 56A appeal was there substantive argument about the power of the Court under s 39(2) to exercise the relevant panel's function to determine the application for a site compatibility certificate. Put in the judge's words, the judge never afforded Zhiva the opportunity to "deal with the s 39 argument now".
9. The second issue of whether the absence of a current site compatibility certificate caused the development application not to be a valid application was never raised at the hearing of the s 56A appeal, either by the parties or by the judge. The first time that the issue emerged was in the judgment where the judge found in [65]: "Although an application for a further site compatibility certificate has been made, at the time of the hearing of this appeal it has not been significantly progressed. There is, therefore, no valid application capable of being remitted to the Commissioner to which, if he was otherwise satisfied on all merit matters, the Commissioner could grant development consent."
10. This finding is legally incorrect. As Spigelman CJ observed in Currey v Sutherland Shire Council (2003) 129 LGERA 223; [2003] NSWCA 300 at [35]: "I see very little, if any, scope in this legislative scheme for the concept of a 'valid' application. Citizens are entitled to apply to authorities for whatever they like. The relevant prohibition in the legislative scheme is found in s 76A, which prohibits development without consent, where an environmental planning instrument provides that development may not be carried out except with consent. There is no relevant prohibition, express or implied, which impinges upon the application making process."
11. The only legal consequence of the lapsing of the site compatibility certificate was that the commissioner, exercising the function of the consent authority to determine the development application for the proposed seniors housing development, did not have power to determine the development application by granting consent. The effect of a current site compatibility certificate is that the consent authority has power to grant consent to a development application for a seniors housing development on land to which the certificate applies despite the provisions of an environmental planning instrument, such as HLEP, that prohibit seniors housing development on the land. That power is lost when the site compatibility certificate lapses. The power can be revived by the issue of a new site compatibility certificate. However, the lapsing of a site compatibility certificate or the issuing of a new site compatibility certificate has no legal effect on the development application for the seniors housing development. A development application does not become an invalid application on the lapsing of a site compatibility certificate or a valid application on the issuing of a new site compatibility certificate.
12. The judge erred on a question of law in deciding otherwise. The judge asked himself the wrong question and misconstrued the meaning and effect of cl 24 of the Seniors SEPP and the relevant provisions of the EPA Act concerning the making and determination of a development application.
13. This error could have been pointed out to the judge had he afforded procedural fairness by notifying the parties that he was likely to decide this issue and giving them an opportunity to be heard on this issue. The judge failed to do so.
14. The judge also denied Zhiva procedural fairness in exercising the power under s 56A(2)(b) of the Court Act to determine the development application by refusing consent, rather than remitting the matter to the commissioner. The function of determining the development application was one to be exercised by the commissioner on the hearing of the appeal against the Council's refusal of the development application. On the appeal being heard by the commissioner, he could exercise the function of the consent authority to determine the development application either by granting consent, unconditionally or subject to conditions, or by refusing consent (see s 4.16(1)(a) and (b) of the EPA Act). Although the commissioner did not so order, he did decide that he had no power to determine the development application by granting consent because of his finding that cl 55 of the Seniors SEPP was not satisfied.
15. On a s 56A appeal, there are limited circumstances where a judge who upholds a s 56A appeal can make an order that the commissioner could have made to determine the development application the subject of the appeal by granting or refusing consent, rather than remitting the matter to the commissioner to be determined in accordance with the judge's decision. The power of the Court under s 56A(2)(b) of the Court Act to dispose of the substantive proceedings is circumscribed. The power under s 56A(2)(b) is to make such other order "in relation to the appeal" as seems fit. The appeal referred to is the s 56A appeal. The order must therefore relate to the nature and terms of the decision that is the subject of the s 56A appeal and the grounds of the particular s 56A appeal.
16. In McInnes v Wingecarribee Shire Council (1987) 64 LGERA 137 at 146, Priestley JA, with whom Kirby P and Clarke JA agreed, doubted whether this Court's power under s 57(2)(b) of the Court Act, which is the same as s 56A(2)(b) of the Court Act, "to make such orders in relation to the appeal as seem fit extends to orders relating to questions other than questions of law".
17. In Murlan Consulting Pty Ltd v Ku-ring-gai Municipal Council, Basten JA, with whom Macfarlan JA agreed, reviewed the cases discussing the scope of s 57(2) of the Court Act and summarised at [70] the principles enunciated by the cases: "The scope of this provision has been considered, over the years, in numerous cases, including recently in Thaina Town (On Goulburn) Pty Ltd v Sydney City Council [2007] NSWCA 300; 71 NSWLR 230; B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187; Director-General, Department of Ageing, Disability and Home Care v Lambert [2009] NSWCA 102; Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138 and HIA Insurance Service Pty Ltd v Kostas [2009] NSWCA 292 at [18]-[22] (Spigelman CJ) and [24] (Allsop P); see also at [118]-[120]. These cases enunciate the following principles: (a) despite the apparent breadth of sub-s (2), the kind of orders permitted will be limited by reference to the subject matter of the appeal; (b) because the appeal is limited to a decision by the Land and Environment Court on a question of law, the orders should properly be limited to that which is appropriate to correct an erroneous decision in that Court; (c) a finding of error does not open a gateway to reconsideration of factual findings made in the Land and Environment Court; (d) nor is a review of factual findings permitted under s 75A of the Supreme Court Act 1970 (NSW); (e) on the other hand, the Court is not necessarily limited to orders of the kind which would be appropriate on judicial review; (f) in particular, the Court may make orders disposing of the proceedings on the basis of facts fully found by the Land and Environment Court or otherwise agreed, or (arguably) on the basis of findings which are the only ones reasonably open in the circumstances, and (g) the Court may exercise a discretionary judgment in disposing of costs orders in the Land and Environment Court."
18. In this Court's recent decision of Universal Property Group v Blacktown City Council [2020] NSWCA 106, Basten JA, with whom Gleeson JA agreed, doubted whether the power under s 57(2)(b) would extend to granting development consent to a development application. In that case, the judge of the Land and Environment Court had determined to refuse consent to the appellant's development application. The appellant appealed against the judge's decision on a question of law. This Court determined that the judge did not err on a question of law and that the appeal should be dismissed. If the appeal had been successful, the appellant had sought an order that, instead of remitting the matter to the judge, this Court could, pursuant to s 57(2)(b) of the Court Act, determine the development application by granting development consent. Basten JA stated: "Had the appeal been upheld, there would have been an issue as to whether the matter should be remitted to the Land and Environment Court for final relief, or whether it could be disposed of by this Court. Final relief favourable to the appellant would have been a grant of consent to its development application. However, that would have required the imposition of conditions. It was said that the 'merit issues', which presumably included appropriate conditions, were not in dispute. However, whether this Court could make such a final order would depend on the order, being an order other than remittal, was 'in relation to the appeal', within the terms of s 57(2)(b) of the Land and Environment Court Act. There must be doubt that this Court take such a step. However, the matter need not be resolved as the issue does not arise." (at [36]).
19. In the present case, whether or not the power under s 56A(2)(b) of the Court Act extended to empower the judge to make the order he made determining the development application by refusing consent, the judge was required to afford procedural fairness to the parties before doing so. Procedural fairness required the judge to notify the parties that he was considering making such an order and affording the parties an opportunity to be heard as to whether there was power under s 56A(2)(b) of the Court Act to determine the development application by refusing consent and, if so, whether the power should be exercised in the circumstances of the case. The judge did not do so. Indeed, the judge told Zhiva's senior counsel he would not make an order under s 56A(2)(b) to determine the Class 1 appeal that was before the commissioner. The judge emphasised that: "There being no suggestion that I should be, as I have done in other matters, when exercising my powers under s 56A, moving to I think s 56A(1)(b) [sic s 56A(2)(b)] and determining the Class 1 appeal."
20. For these reasons, grounds 1, 2 and 5 of the appeal should be upheld. It is not necessary to address Zhiva's argument that the judge's decision that there was no utility in remitting the matter to the commissioner was manifestly unreasonable.
21. The question that now arises is what order should this Court make. The parties agree that there should be a remitter of the matter to the Court below. The parties disagree on whether that remitter should be to the judge who determined the s 56A appeal or the commissioner who determined the Class 1 appeal.

The question to whom the matter should be remitted

1. Zhiva submitted that this Court should order that the matter be remitted to the commissioner rather than the judge. Although the appeal to this Court under s 57(1) of the Court Act is against the decision and order of the judge and ordinarily, under s 57(2)(a), this Court will remit the matter to the judge whose decision is the subject of the appeal, unless an exclusionary remitter is made, the Council submitted that this Court can make an order remitting the matter directly to the commissioner. The Council submitted that the power to remit the proceedings to the commissioner is found in s 57(2)(a) or s 57(2)(b) of the Court Act or otherwise in s 75A(10) of the Supreme Court Act.
2. As to s 57(2)(a), Zhiva submitted that, although the Court is constituted by a judge of the Court (s 6(1) of the Court Act), once the Chief Judge directs that the proceedings be heard and disposed of by a commissioner (under s 36 of the Court Act) or the proceedings are statutorily required to be heard and disposed of by a commissioner (see s 34B and s 34C of the Court Act), the commissioner exercises the Court's jurisdiction in relation to the particular matter (see s 30(1)(a) of the Court Act). The commissioner's decision is deemed to be the decision of the Court: s 36(3) of the Court Act and Community Association DP 270447 v ATB Morton Pty Ltd (2019) 240 LGERA 32; [2019] NSWCA 83 at [58]. The Council submitted that the remitter to the commissioner who has been allocated to hear and dispose of the matter is therefore a "remitter of the matter to the Court" within s 57(2)(a) of the Court Act.
3. As to s 57(2)(b), Zhiva submitted that the power to make such other order in relation to the appeal as seems fit includes the power to remit the matter to the commissioner. The appeal to this Court under s 57(1) is against the decision and orders of a judge of the Court on an appeal under s 56A(1) of the Court Act against the decision and orders of the commissioner. The judge, on hearing the appeal under s 56A(1), had power under s 56A(2)(a) to remit the matter to the commissioner. This Court, in hearing the appeal under s 57(1), has power under s 57(2)(b) to make any order the judge whose decision is the subject of appeal could have made, including remitting the matter to the commissioner.
4. As to s 75A(10), Zhiva submitted this Court may make any order which the judge ought to have made or the nature of the case requires. This evidently included remitting the matter to the commissioner.
5. Zhiva submitted that remitter to the commissioner was the appropriate order in light of the issue of the new site compatibility certificate and Zhiva's foreshadowed application to amend its development application. The issue of the site compatibility certificate removes the twin bases of the judge's decision not to remit the matter to the commissioner, which were that the commissioner did not have power to determine the application for a site compatibility certificate and the absence of a current site compatibility certificate caused the development application not to be a valid application. These two bases were the only reasons given by the judge for not remitting the matter to the commissioner. Now they have fallen away by the issue of the new site compatibility certificate, there is no reason not to remit the matter to the commissioner.
6. Zhiva has foreshadowed that it will apply to amend its development application the subject of the appeal before the commissioner in two respects. First, the proposed seniors housing development certified by the new site compatibility certificate differs from the development the subject of the current development application. Zhiva wishes to apply to amend the development application to align the development for which consent is sought with the development in respect of which the site compatibility certificate was issued. Secondly, Zhiva wishes to amend the development application to include a fire sprinkler system in the plans for the proposed development. The commissioner had decided, on the plans then before him, that the proposed development did not include a fire sprinkler system. Zhiva contested that factual finding but, in order to avoid doubt, wishes to make express provision in the plans for fire sprinklers to establish that the proposed development includes a fire sprinkler system and hence satisfies cl 55 of the Seniors SEPP.
7. Zhiva submitted that any application to amend the development application in these two respects needs to be made to the commissioner hearing the appeal against the Council's refusal of the development application, not the judge hearing the s 56A appeal against the commissioner's decision. The commissioner can exercise the power under cl 55 of the Environmental Planning and Assessment Regulation 2000 to allow Zhiva to file an amended application for development consent and to make an order for the payment by Zhiva of the costs of the Council that have been thrown away as a result of any amendment of the application for development consent (see s 8.15(3) of the EPA Act). The judge hearing and disposing of the s 56A appeal, on the other hand, does not have power to allow Zhiva to file an amended application for development consent as such an order is not "in relation to the appeal" under s 56A.
8. Zhiva submitted that, if the commissioner were to allow Zhiva to file an amended application for development consent, this would alter the basis for the commissioner's prior decision that cl 55 of the Seniors SEPP was not satisfied. The commissioner would not be precluded by his prior decision from reconsidering and redeciding whether cl 55 of the Seniors SEPP was satisfied by reason of the proposed development in the amended development application including a fire sprinkler system.
9. In these circumstances, it is not necessary for the matter to be remitted to the judge to decide the grounds of appeal concerning the commissioner's construction and application of cl 55 of the Seniors SEPP, which the judge did not decide in determining the s 56A appeal. There is no utility in the judge determining whether the commissioner's decision on cl 55 of the Seniors SEPP involved error on a question of law because the factual basis for the commissioner's decision will alter if Zhiva is allowed to file an amended application for development consent. The commissioner's decision on cl 55 of the Seniors SEPP was dependent on his factual finding that the proposed development in the development application then before him did not include a fire sprinkler system. Once the development application is expressly amended to include a fire sprinkler system, the commissioner's reason for finding that cl 55 of the Seniors SEPP was not satisfied falls away.
10. The Council accepted that this Court has power to remit the matter to the commissioner, and not only to the judge, whether that power is sourced in s 57(2)(a) or s 57(2)(b) of the Court Act or s 75A(10) of the Supreme Court Act. The Council submitted, however, that this Court should not remit the matter to the commissioner, but instead to the judge. The Council gave four reasons.
11. First, the judge has not determined the grounds of appeal concerning the commissioner's construction and application of cl 55 of the Seniors SEPP. The judge decided that, as a consequence of Zhiva's success on the ground of procedural fairness, which necessitated the upholding of the appeal, it was unnecessary to address the grounds concerning the commissioner's construction and application of cl 55 of the Seniors SEPP (at [51]). The Council submitted that it is necessary for the judge to decide these grounds concerning cl 55 of the Seniors SEPP before the commissioner can determine the appeal against the Council's refusal of the development application for the proposed seniors housing development. If the matter were to be remitted directly to the commissioner, the commissioner's finding that he was legally prevented from granting development consent because the proposed development did not satisfy cl 55 would continue to stand. Leaving this finding undisturbed would make the remitter to the commissioner of questionable utility (Respondent's written submissions on form of remitter, [8(a)]).
12. Secondly, the Council submitted that the issue of the new site compatibility certificate is a change of circumstance that might affect the judge's decision on the utility of remitting the matter to the commissioner. The Council, although having entered a submitting appearance in the s 56A appeal, submitted that it may wish to seek leave under UCPR r 6.11(2) to make a submission to the judge, if the matter were remitted to the judge, on the utility of remitting the matter to the commissioner in light of the new site compatibility certificate. The Council submitted that this question is better left to the discretion of the judge given the Court's specialist jurisdiction, rather than being determined by this Court (Respondent's written submissions on form of remitter, [8(b)]).
13. Thirdly, the Council submitted that if and when the matter is remitted to the commissioner (whether by this Court or by the primary judge), the commissioner's function will be to determine the appeal before him, being the appeal against the Council's decision to refuse consent to the development application, "in accordance with the decision of" this Court and the judge (being the requirement of s 57(2)(a) and s 56A(2)(a) of the Court Act). The Council submitted that in any determination of the appeal by the commissioner, the undisturbed findings of the commissioner would stand and the commissioner would determine the outstanding issues on the existing evidence, subject to the admission of any further evidence and any application to amend: Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2009) 168 LGERA 1; [2009] NSWCA 178 at [118].
14. The admission of any further evidence or allowance of any application to amend the development application would not result from the correction of any error on a question of law by the appellate decisions of this Court or the judge. Rather, they would result from the proposed development certified in the new site compatibility certificate not corresponding with the development proposed in the current development application (Respondent's written submissions on form of remitter, [8(c)]).
15. The Council submitted that any application by Zhiva to amend its development application to align the proposed development with the development certified in the new site compatibility certificate and to include a fire sprinkler system "might legitimately be opposed" by the Council. One reason proffered by the Council for its possible opposition to amendment of the development application was that "retention of the two specific trees named in Schedule 2 to the new SCC would necessitate significant amendments to the civil works and building designs proposed in DA/668/2018" (Respondent's written submissions on form of remitter, [10]). Another reason suggested by the Council related to the extent of the amendments that might need to be sought. There might be a question of whether the changes to the proposed development are so extensive as not to be capable of being the subject of an amended application but instead would require a new development application to be made to the consent authority (Respondent's written submissions on form of remitter, [14]).
16. Fourthly, remitter of the matter to the commissioner will not necessarily enable the commissioner to evaluate the merits of the proposed development. Even if the commissioner were to allow amendment of the development application to include a fire sprinkler system, which would enable cl 55 of the Seniors SEPP to be satisfied, the issue of the new site compatibility certificate potentially gives rise to a different basis on which the commissioner could again refuse consent to the development application without a determination of the merits. Accordingly, seeking leave to amend the development application will not necessarily resolve the matter (Respondent's written submissions on form of remitter, [12], [13]).
17. I consider that remitter should be made to the commissioner rather than the judge. Nothing is to be gained by remitting the matter to the judge for determination by him in accordance with the decision of this Court.
18. First, the judge has already determined to uphold the s 56A appeal as a consequence of Zhiva's success in establishing the appeal ground that the commissioner denied Zhiva procedural fairness in reaching his decision that cl 55 of the Seniors SEPP was incapable of satisfaction by a condition of development consent (at [50], [51] of the judge's decision). Indeed, the judge ordered that the appeal be upheld (at [70]) but instead of setting aside the commissioner's decision and orders and remitting the matter to the commissioner for determination in accordance with the judge's decision, the judge made another order under s 56A(2)(b) of the Court Act to determine Zhiva's development application by refusing consent. The judge's determination not to remit the matter to the commissioner was for two reasons only. Those two reasons were arrived at without affording procedural fairness to Zhiva. In the events that have happened, however, those two reasons are no longer applicable.
19. The judge's concern was that there was no current site compatibility certificate and that the commissioner had no power to issue a site compatibility certificate. As a consequence, the proposed development was prohibited, which prohibition could not be set aside by the "potentially available beneficial and facultative provisions" of the Seniors SEPP (at [66]). The judge's concern has now been addressed by the issue of the new site compatibility certificate. Development consent can be granted to the proposed seniors housing development certified in the new site compatibility certificate. The judge raised no other basis for not remitting the matter to the commissioner. In these circumstances, there is no benefit in remitting the matter to the judge for him to determine whether, having upheld the appeal, he should remit the matter to the commissioner.
20. Secondly, there is no benefit in remitting the matter to the judge for him to determine the grounds of appeal concerning the commissioner's construction and application of cl 55 of the Seniors SEPP, which the judge did not decide (at [51]). One reason is that the judge has already decided to uphold the appeal against the commissioner's decision on the ground that the commissioner had denied procedural fairness to Zhiva in making his decision. That finding was sufficient for the judge to have set aside the commissioner's decision and order. It was unnecessary to address and uphold other grounds of appeal in order to set aside the commissioner's decision and order. The judge would have set aside the commissioner's decision and order and remitted the matter to the commissioner to be redetermined had the judge not found that there was no utility in remitting the matter to the commissioner. This Court can now make the order that the judge could and should have made of setting aside the commissioner's decision and order, before remitting the matter to the commissioner.
21. Another reason for not remitting the matter to the judge for determination of the grounds of appeal concerning the commissioner's construction and application of cl 55 of the Seniors SEPP is that there is no utility in such determination in light of Zhiva's foreshadowed application to amend the development application to ensure that the proposed development does include a fire sprinkler system. There can be no basis for the Council to oppose such an application to amend the development application. Before the commissioner, the Council had not raised as a basis for refusal of the development application that the proposed development did not include a fire sprinkler system. The Council joined with Zhiva in submitting to the commissioner that imposition of a condition of consent requiring the proposed development to include a fire sprinkler system would be sufficient to satisfy cl 55 of the Seniors SEPP. Zhiva's foreshadowed application to amend the development application to ensure that the proposed development includes a fire sprinkler system would merely bring forward what the Council had agreed should be required by the proposed condition of consent.
22. Once the proposed development is amended to include a fire sprinkler system, the commissioner can be satisfied that cl 55 of the Seniors SEPP is met. The commissioner's duty in determining the appeal on remitter is to determine the development application in the form and on the facts that then exist. It matters not that the commissioner may have found in his earlier decision that the development proposed in the development application in its form and on the facts at that time did not include a fire sprinkler system and hence that cl 55 of the Seniors SEPP was not satisfied. Those factual findings do not bind the commissioner in determining whether the development proposed in any amended application does include a fire sprinkler system and hence whether cl 55 of the Seniors SEPP can be satisfied for that amended proposed development.
23. Thirdly, it would not be appropriate to remit the matter to the judge for him to decide whether Zhiva should be allowed to amend the development application to align the proposed development with the development certified in the new site compatibility certificate and to include a fire sprinkler system. The judge is in an inferior position to the commissioner to decide factually whether such amendments to the development application should be allowed. More importantly, however, the judge has no power to decide such an application to amend the development application, as an order determining the application to amend the development application would not be "in relation to the appeal" under s 56A.
24. The Council's foreshadowing of its possible opposition to Zhiva's application to amend the development application to align the proposed development with the development certified in the new site compatibility certificate does not affect the person to whom this Court should remit the matter, whether the judge or the commissioner. The Council can oppose Zhiva's application to amend its development application equally before the commissioner as it can before the judge.
25. Fourthly, the fact that remitter of the matter to the commissioner might not resolve the matter, because further issues may arise if and when Zhiva amends its development application, does not affect the person to whom the matter should be remitted. Remitter to the judge rather than the commissioner will not preclude such further issues arising.

Orders

1. In the circumstances, the appropriate orders that this Court should make are to set aside the judge's order 2 determining the development application by the refusal of development consent and the commissioner's order 2 dismissing the appeal, and instead to remit the matter to the commissioner for determination by the commissioner in accordance with the decision of this Court and the decision of the judge.
2. In relation to costs, the parties agreed that costs should follow the event on the question of remitter and be confined to the costs of that question. This means that if the Court upholds the appeal and remits the matter to the commissioner, the Council should pay Zhiva's costs of the appeal on the question of the remitter. Zhiva estimated that such cases were about 25% to 30% of the costs of the appeal. The Council preferred the lower percentage estimate. The Council should pay 25% of Zhiva's costs of the appeal to this Court.
3. The following orders should be made: 1. Extend the time for filing the summons seeking leave to appeal until 28 January 2020. 2. Grant leave to appeal in the form of the amended draft notice of appeal dated 10 June 2020. 3. Grant leave to adduce further evidence on the appeal, being paragraphs 15 and 16 of the affidavit of Matt Sonter sworn on 1 May 2020 and the site compatibility certificate issued on 16 April 2020 and attached as Annexure A to that affidavit. 4. Allow the appeal. 5. Set aside order 2 made by Moore J on 28 October 2019. 6. Set aside order 2 made by Chilcott C on 22 May 2019. 7. Remit the matter to Chilcott C for determination by the Commissioner in accordance with the decision of this Court and the decision of Moore J. 8. Order that the respondent pay 25% of the appellant's costs in this Court.

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: 20 August 2020