AGRICORP AUSTRALIA PTY LTD t/as VMS CONTRACTORS and SHIRE OF WEST ARTHUR
[2025] WASAT 40
•6 MAY 2025
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: PLANNING AND DEVELOPMENT ACT 2005 (WA)
CITATION: AGRICORP AUSTRALIA PTY LTD t/as VMS CONTRACTORS and SHIRE OF WEST ARTHUR [2025] WASAT 40
MEMBER: DR S WILLEY, SENIOR MEMBER
HEARD: 15 AND 16 OCTOBER AND 27 NOVEMBER 2024
DELIVERED : 6 MAY 2025
FILE NO/S: DR 53 of 2024
BETWEEN: AGRICORP AUSTRALIA PTY LTD t/as VMS CONTRACTORS
Applicant
AND
SHIRE OF WEST ARTHUR
Respondent
Catchwords:
Town planning - Development application - Land use classification - Statutory construction - Meaning of rural product
Legislation:
Environmental Protection Act 1986 (WA), Pt V
Environmental Protection Regulations 1987 (WA), Sch 1
Planning and Development (Local Planning Schemes) Regulations 2015 (WA), Sch 2, cl 67(2)(n)
Planning and Development Act 2005 (WA), s 3(1)(b)
Shire of West Arthur Local Planning Scheme No 2, cl 4.2, cl 4.3.1, cl 4.3.2, Sch 1
State Administrative Tribunal Act 2004 (WA), s 9, s 29(9)
Result:
The decision under review is affirmed
The application for review is dismissed
Category: B
Representation:
Counsel:
| Applicant | : | Mr J Skinner |
| Respondent | : | Mr CA Slarke |
Solicitors:
| Applicant | : | Thomson Geer - Perth |
| Respondent | : | McLeods |
Case(s) referred to in decision(s):
Attwell and City of Albany [2009] WASAT 38; (2009) 61 SR (WA) 25
Australian Unity Property Ltd v City of Busselton [2018] WASCA 38; (2018) 237 LGERA 333
Castle and City of Rockingham [2018] WASAT 98
Drummoyne Municipal Council v Maritime Services Board (1991) 72 LGRA 186
Ecogrowth Intrenational Pty Ltd and City of Swan [2012] WASAT 109
G & G Corp Asset Management Pty Ltd and Presiding Member of the Metropolitan East Joint Development Assessment Panel [2018] WASAT 9; (2018) 94 SR (WA) 36
Harvis Capital Pty Ltd v Mid-Awest/Wheatbelt Joint Development Assessment Panel [2020] WASC 205
Humich Nominees Pty Ltd v Metro East Joint Development Assessment Panel [2019] WASC 200
KIPA Freeholds Pty Ltd v Development Assessment Commission (1999) 101 LGERA 414
Landcorp and City of Stirling [2011] WASAT 202
Newco Mills Pty Ltd and Presiding Member of the Metro Outer Joint Development Assessment Panel [2021] WASAT 160
Remove-All-Rubbish v City of Salisbury (1989) 51 SASR 26
Sanders v City of South Perth [2019] WASC 226
Ursula Frayne Catholic College and Town of Victoria Park [2020] WASAT 17; (2020) 99 SR (WA) 76
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
These reasons address the question of whether a composting facility (proposed development) is a permissible use on land which is zoned Rural in the Shire of West Arthur Local Planning Scheme No. 2 (Scheme). The proposed development is be located on Lots 4 and 5 Stewart Road, Moodiarrup (together the land).
The matter was heard on 15 and 16 October 2024 and 27 November 2024. The final hearing focused on two discrete questions. The first was the permissibility of the proposed development under the Scheme. The second was the odour, and amenity impacts.
As I will come to explain, the only issue that remains to be determined is whether the proposed development is capable of approval. That contest is focused on whether the proposed development is classified as 'industry - rural' or not.
If the proposed development is properly classified as an 'industry - rural' it is a use that is capable of approval in the Rural Zone. If it is not so classified, the proposed development would then fall within the 'industry - general' land use, which is prohibited in the Rural Zone.
For the reasons that follow, the correct and preferable decision is to dismiss the application for review.
Issues
As I have stated, while the final hearing did address the question of whether the odour generated by the proposed development would have an unacceptable impact on the amenity of the locality, that issue has largely fallen away by reason of amendments made to the proposed development following the final hearing.
I turn now, to set out the relevant facts.
The land and the locality
The land:
(a)is used for broadacre farming. The proposed development involves a lease of a portion of the land.[1] If approved, the land outside the lease area will continue to be used for agricultural pursuits;
(b)has a frontage to Stewart Road via Lot 5, and to Boyup BrookArthur Road via Lot 4;
(c)is largely cleared; and
(d)is zoned Rural pursuant to the Scheme.[2]
[1] The development application contains an undated lease that describes the leased area as being 2 hectares, however the infrastructure for which approval is sought has an area of more than 3 hectares. The dimensions of the composting pad described in the application are 150 metres x 200 metres (3 hectare) plus a drainage pond of 35 metres x 35 metres.
[2] Exhibit 2, Document 13.
The wider locality is largely used for broadacre farming.
There are dwellings on Lot 8 (to the south of Lot 5)[3] and on Lot 17584[4] (to the north‑east of Lot 5). Lot 100 (to the west of Lot 5) is subject to a conservation covenant which identifies the potential location for a dwelling.[5]
[3] The dwelling is approximately 1,900 metres from the proposed composting pad.
[4] Lot 1758 is also owned by Messrs Ainsworth and Calais and forms part of Glenwood Farm. The dwelling is approximately 2,400 metres from the proposed composting pad.
[5] The building envelope is approximately 2,100 metres from the proposed composting pad.
The proposed development
The original development proposal
By application dated 15 January 2024,[6] Agricorp Australia Pty Ltd t/s VMS Contractors (Applicant) sought approval pursuant to the Scheme for the development of a composting facility on Lot 5, to be accessed through Lot 4.
[6] Exhibit 2, Document 4. The Applicant originally sought approval via an application dated 7 May 2023, but that application was subsequently withdrawn.
The material submitted in support of the proposed development includes:
(a)'Agri Corp Australia Pty Ltd Composting Works Approval Supporting Document' by SHEQ Management dated 20 December 2023 (Development Report);[7] and
(b)'Compost Quality Production Manual' by VMS Contractors[8] dated 20 December 2023 (CQP Manual).[9]
[7] Exhibit 2, Document 3.
[8] VMS Contractors is the Applicant's trading name.
[9] The CQP Manual is Appendix 5 to the Development Report.
The Development Report explains that the Applicant operates a composting facility at Hithergreen in the City of Busselton but that '[o]ver time, the surrounding area has undergone residential development resulting in encroachment of the buffer distance required for the operations'[10] and therefore the Applicant seeks to relocate the facility to Lot 5.
[10] In an email from the Director of the Applicant sent to the Shire on 28 April 2023 in connection with the original application, it is said that '[t]he reason for us moving is our neighbours in Busselton have subdivided [their] farm and we are having houses built on our boundary, composting needs a 200m buffer and we don't have this anymore at our site'. See Exhibit 2, Document 1.
Section 4.2 of the Development Report describes the proposed activities in the following way:
VMS seeks approval for the construction and operation of a composting facility with an annual production capacity of 45,000 tonnes of compost.
Over an annual period, the composting process will typically include the following materials:
35,000 tonnes of biosolids (sourced from Water Corporation)
5,000 tonnes of pig manure
8,000 tonnes of green waste/straw, consisting of:
-Saw dust
-Straw
-Oat husks
-Pine shavings
-Green waste
Compost production occurs over a 4 - 8-week time cycle, with the material generally breaking down to about one third of the input materials. The end product will not be bagged or sold; it will be used as a soil conditioner for properties owned by VMS and or its subsidiaries for soil rehabilitation[.]
The 'overall quality control process for the manufacturing of compost' is described in section 4.2 of the Development Report in the following way:
The overall quality control process for the manufacturing of compost comprises of the following steps (as shown in Figure 2):
1.All feedstock material is delivered directly to the Composting Pad.
2.Biosolids are delivered on a regular basis to prevent stockpiling.
3.Biosolids are processed within 24hrs of delivery.
4.Front end loader is used to spread material into a row to a max 2m x 2m.
5.Green waste/straw and manure are spread over biosolids to form windrows.
6.Windrow turner is used to blend material every 2 – 3 days.
7.Quality Control monitoring is undertaken at every turn event.
8.At completion of a 28-day composting cycle, material is sampled and sent to a NATA accredited laboratory for analysis of P1 (pathogens 1) C1 (contaminants 1) as per VMS's current EP Licence L8526/2011/2.
9.End product is utilised as soil conditioner within VMS premises where land is used for cropping: wheat, canola etc[.]
The manufacturing of compost will take place on a composting pad 3 hectares in size (150 metres x 200 metres). A drainage pond (35 metres x 35 metres) will collect leachate and other liquid runoff from the pad. Both the composting and the drainage pond will be lined with an HDPE geomembrane.
The compost will not be bagged or sold; it will be used as a soil conditioner for properties owned by the Applicant and or its subsidiaries.
The Shire of West Arthur (Respondent) refused the proposed development on 25 March 2024 on the basis that the use was properly classified as 'industry - general' which is a prohibited use in the Rural Zone. The Shire's decision is the reviewable decision for the purposes of this proceeding.
The proposed development is amended
The proposed development was amended in September 2024. In amending the proposed development, the Applicant clarified that it was seeking approval for a composting facility with maximum inputs of 15,000 tonnes per annum of biosolids and 12,000 tonnes per annum of green waste with a maximum production capacity of 18,000 tonnes of compost. No longer would pig manure be used in the compost mixture.
The rationale for the amended proposal was that the inputs of biosolids (15,000 tonnes) and green waste (12,000 tonnes) were as permitted at the existing Hithergreen facility (under Licence L8526/2011/2). The maximum capacity of 18,000 tonnes was selected by reference to the separation distance to the nearest sensitive receptor, which is located 1.9 kilometres away. The relevant EPA guidelines recommend a separation distance of 1.8 kilometres for an outdoor uncovered compost manufacturing facility with a production capacity of up to 20,000 tonnes per annum.[11]
[11] EPA Guidance Statement 3, Exhibit 2, Document 14.
The Applicant has always maintained ‑ through both the original and amended proposed development ‑ that the inputs for the composting process will be at a ratio of approximately 4:1 by volume (green waste/biosolids).
However, there was no correlation between the inputs proposed in the amended proposal and the proposed maximum capacity. That is to say, 12,000 tonnes of green waste and 15,000 tonnes of biosolids do not represent the mixing ratio of 4:1. The Applicant says that the inputs identified were not based on the proposed mixing ratio, but by reference to what was permitted at Hithergreen. The maximum production capacity for the amended proposal was based on separation distances, not by reference to the proposed inputs. The Applicant concedes this resulted in some confusion throughout the final hearing.
The further amended proposed development
To clarify this confusion, following the final hearing, the Applicant sought leave, which was ultimately granted at a hearing on 27 November 2024, to further amend the proposed development as follows:
(a)the initial mixing ratio of 4:1 (green waste: biosolids) be included as a specific element of the Environmental Management Plan required by condition 2 proposed by the Shire in its without prejudice draft conditions of approval;[12] and
(b)the compost inputs will be:
(i)the maximum tonnage of biosolids to be received is to remain at 15,000 tonnes per annum;
(ii)the maximum production tonnage of green waste to be received is 19,000 tonnes per annum (an increase of 7,000 tonnes per annum); and
(iii)the maximum production capacity of the composting facility is 10,000 tonnes per annum (a reduction of 8,000 tonnes per annum).
[12] The Shire consented to this proposal, but not the amendments to the compost inputs.
The Applicant's rationale for the further amended proposed development is as follows:
(a)for biosolids, 1m3 by volume equates to approximately 1:1 tonnes;
(b)15,000 tonnes of biosolids therefore equates to a volume of approximately 13,636m3;
(c)at a ratio of 4:1 (green waste: biosolids) in the initial mixing, 13,636m3 of biosolids requires 54,545m3 of green waste;
(d)54,545m3 of green waste therefore equates to approximately 19,000 tonnes, reflecting the amendment referred to in para [23(b)(ii)] above;
(e)for the finished compost product, the volume of the finished product is approximately one‑third of the total volume of the inputs, and also that 1m3 of compost equates to approximately 0.40 tonnes;
(f)the total volume of inputs is approximately 68,200m3 (being 13,636m3 of biosolids plus 54,545m3 of green waste);
(g)compost production therefore equates to approximately 22,750m3 per annum; and
(h)22,750m3 of compost equates to approximately 9,100 tonnes, reflecting the amendment referred to in para [23(b)(iii)] above.
In applying for the further amended proposed development, the Applicant submitted that there is no prejudice to the Shire. The reduced maximum capacity of 10,000 tonnes reduces the recommended screening (or buffer) distance to 1.3 kilometres (recommended for a facility with a maximum capacity of 12,000 tonnes). The distance to the nearest sensitive receptor, which is not in dispute, is nearly 1.9 kilometres, almost double the applicable recommended distance.
Consistent with the position of the parties, I find that, on account of the further amended proposed development, odour is no longer a significant issue in the context of the proposed development.
Relevant Scheme provisions
The objectives of the Rural Zone, which are set out in cl 4.2 of the Scheme, are:
−To ensure the continuation of broad-hectare agriculture as the principal land use in the district, encouraging where appropriate the retention and expansion of agricultural activities.
−To provide for intensive agricultural uses and diversified farming which retain the rural character and amenity of the locality, and which are consistent with land suitability.
−To help protect rural land from land degradation and further loss of biodiversity by:
•minimising clearing of remnant vegetation
•encouraging retention and protection of remnant vegetation
•encouraging development and protection of vegetation corridors
•encouraging development of sustainable surface and sub-surface drainage works
•encouraging rehabilitation of salt-affected land
•encouraging soil conservation through land management measures
•encouraging identification and protection of wetlands
−To consider non-rural uses where they can be shown to be of benefit to the district and not detrimental to the natural resources or the environment.
−To allow for facilities for tourists and travellers, and for recreation uses.
−To have regard to use of adjoining land at the interface of the rural zone with other zones to avoid adverse effects on local amenities.
Pursuant to cl 4.3.1 of the Scheme the Zoning Table indicates the permissibility of land use within the Scheme area. Relevantly, within the Rural zone:
(a)'industry - general' is an 'X' (prohibited) use; and
(b)'industry - rural' is a 'D' (discretionary) use.
The use classes industry - general and industry - rural are defined in Schedule 1 of the Scheme as follows:
'industry - general' means an industry other than a cottage, extractive, light, mining, rural or service industry;
'industry - rural' means —
(a)an industry handling, treating, processing or packing rural products; or
(b)a workshop servicing plant or equipment used for rural purposes
Pursuant to Sch 1 to the Scheme the word 'industry' is defined as follows:
'industry' means premises used for the manufacture, dismantling, processing, assembly, treating, testing, servicing, maintenance or repairing of goods, products, articles, materials or substances and includes premises on the same land used for —
(a)the storage of goods;
(b)the work of administration or accounting;
(c)the selling of goods by wholesale or retail; or
(d)the provision of amenities for employees,
incidental to any of those industrial operations;
Respondent's submissions
The Shire submits that the proposed development is properly classified as an 'industry - general' which is a prohibited use in the Rural Zone.
On the contrary, the Shire submits that the proposed development is an 'industry - general' because it will involve 'premises used for the manufacture … of … products' and 'premises used for the … processing … of … materials of substances'.
The proposed development is not an 'industry - rural' because:
(a)neither the primary input (biosolids) nor the output (compost) is a rural product; and
(b)it involves manufacturing compost, whereas 'industry - rural' does not permit manufacturing.
As the proposed development does not fall within the meaning of any other type of industrial use under the Scheme, it is therefore an 'industry - general'. As a result, the proposed development is for an 'X' use and is therefore incapable of approval.
In oral argument, Mr Slarke, counsel for the Shire, emphasised that the effect of decisions such as Newco Mills[13] and Harvis Capital,[14] which deal with scheme definitions in almost identical terms, is that in order to be a rural industry, the process cannot be characterised as 'manufacturing'.
[13] Newco Mills Pty Ltd and Presiding Member of the Metro Outer Joint Development Assessment Panel [2021] WASAT 160.
[14] Harvis Capital Pty Ltd v Mid-Awest/Wheatbelt Joint Development Assessment Panel [2020] WASC 205.
Neither Newco Mills nor Harvis Capital focused on the question of what was, or was not, to be regarded as a 'rural product'. However, the Tribunal has considered that question in cases such as Attwell and City of Albany (Attwell)[15] as well as Ecogrowth International Pty Ltd and City of Swan (Ecogrowth).[16] Mr Slarke emphasised that in Attwell, the Tribunal found that the ordinary meaning of the word 'rural' pertaining to, or being characteristic of, the country, as opposed to town or city. The Tribunal found that the ordinary meaning of the adjective 'rural' invoked a country/urban dichotomy.[17]
[15] Attwell and City of Albany [2009] WASAT 38; (2009) 61 SR (WA) 25 (Attwell).
[16] Ecogrowth Intrenational Pty Ltd and City of Swan [2012] WASAT 109.
[17] Attwell [27].
In Attwell, the question was whether manufactured limestone blocks (to be used in retaining walls) were 'rural products'. The overarching conclusion that the Tribunal reached was that laterite and limestone were not rural products because they are found in both urban and rural locations. Furthermore, the question of what a 'rural product' focused attention on the nature of the product, not the location of its extraction.
In Ecogrowth, the proposal was for the production of organic fertiliser. The Tribunal determined that the primary inputs for that process, which were granulated rock dust and liquid soil improvers, were not 'rural products'. Moreover, the resultant fertiliser would not only have agricultural application but could also be used in non‑agricultural contexts.
In this case, the primary composting ingredient is human waste, being the biosolids, which is not a product that is characteristic of the country. Biosolids are a waste product created in both rural and urban areas. The other product - being green waste - is also not necessarily characteristic of the country, although straw and oat husks, as well as pine shavings, are likely to be 'rural products'. To the extent that some 'rural products' may be involved, the Tribunal would need to be satisfied that they comprise the 'major part of the totality of the products that are handled'.[18]
[18] ts 117, 16 October 2024.
The resultant compost is not a 'rural product'. In fact, one could speculate that more compost is used in urban areas than in rural areas owing to the larger urban population. The fact that the compost will be used by the Applicant as part of its agricultural operations is merely a quirk of the application but cannot convert the compost into being characterised as a 'rural product'. It is the inherent nature of the resultant product which drives the outcome as to whether an industry is properly characterised as an 'industry - rural'.
The Shire further submitted that approval conditions cannot overcome what are inherent problems with the proposed development. In G & G CorpAsset Management Pty Ltd and Presiding Member of the Metropolitan East Joint Development Assessment Panel (G & G Corp),[19] the Tribunal outlined that approval conditions cannot have the effect of converting a prohibited use into a use which the planning authority may consider approving, or into an incidental use which does not require approval.
[19] G & G Corp Asset Management Pty Ltd and Presiding Member of the Metropolitan East Joint Development Assessment Panel [2018] WASAT 9; (2018) 94 SR (WA) 36 [51].
Because neither the inputs nor the resultant compost are 'rural products', the proposed development cannot be an 'industry - rural'. Moreover, the composting process itself is a manufacturing process.
In Harvis Capital, Allanson J found, in the context of an application for a feed mill, that:[20]
The composite phrase, 'an industry handling, treating, processing or packing rural products' refers to processes which occur in, or may be part of, manufacture. But processing and manufacture are not synonymous. The fact that different products are combined and treated would not necessarily exclude the feed mill operation from being described as treating and processing rural products. But the whole operation described in the application - milling, mixing to mash, manufacture into pellets, crumbling and coating - is more than treating and processing the grains and meals. It is the manufacture of a separate product.
[20] Harvis Capital [86].
Likewise, in Newco Mills Pritchard J explained that '[t]he ordinary meaning of the verb 'manufacture' encompasses making products or goods out of raw materials to produce other goods, using physical labour or machinery, especially on a large scale, and converting raw materials or ingredients into a specified product'; and 'to make or produce by hand or machinery, especially on a large scale'. Pritchard J would ultimately conclude that:[21]
… the application of orthodox principles of construction, manufacturing - which is one of the primary activities listed within the definition of 'industry' - does not fall within the activities encompassed within the 'Industry - Rural' use class.
[21] Newco Mills [93].
In this instance, the fundamental nature of the proposed development is the creation of a new product, being the compost. It is an activity that is carried out on a large scale and involves manufacturing. It is not a passive process. It involves the unloading of biosolids onto the pad. It might also involve the shredding/crushing/handling of the green waste that is mixed with the biosolids and formed into windrows. Those windrows are turned every two to three days as part of the mixing process. Water may be added. There is consistent, if not continuous, mechanical intervention in the processing of the materials the result of which is a new product. The required equipment includes a front‑end loader and windrow turner as well as other equipment.
The result of the process is a P1C1 soil conditioner which is a materially different product from the raw material inputs. The biosolids are converted from being regulated waste to a product that can be spread in suburban backyards. The compost is not handled through the process but is the resultant output. To the extent that there is processing involved, it is processing of the feedstock.[22]
[22] ts 120, 16 October 2024.
Finally, it is not insignificant that in order to carry out the proposed development, the Applicant requires a licence to be issued under Pt V of the Environmental Protection Act 1986 (WA) for category 67A premises as defined in Sch 1 to the Environmental Protection Regulations 1987 (WA).
Category 67A is itself described as 'compost manufacturing and soil blending premises on which organic material (excluding silage), or waste is stored pending processing, mixing, drying or composting to produce commercial quantities of compost or blended soils' which produce 1,000 tonnes or more per year.
The materials lodged in support of the proposed development are also replete with references to the process being one of 'manufacturing', including statements which detail the Applicant's experience in 'compost manufacturing'. While such references are not determinative, they do underscore the point that the creation of compost by the method proposed falls within the ordinary meaning of the term 'manufacturing'.
Accordingly, the proposed development cannot be approved.
Applicant's submissions
General principles
Unsurprisingly, the Applicant's submissions also focus on the decisions of Harvis Capital and Newco Mills. It refers to Pritchard J's conclusion in Newco Mills that:[23]
Taking all of these considerations into account, the compelling conclusion is that while the definition of 'Industry - Rural' refers to 'industry', the primary activities falling within the definition of 'industry' are not incorporated into the 'Industry - Rural' definition. Instead, only the activities expressly set out in the definition of the 'Industry - Rural' use class, namely the 'handling, treating, processing or packing [of] rural products' and 'a workshop servicing plant or equipment used for rural purposes' are encompassed by that land use class. However, there is nothing to suggest that the drafter intended that other aspects of the definition of 'industry' - namely the concept of the use of premises for the activities in question, or the various activities capable of being regarded as ancillary uses (understood by reference to rural products) - should be excluded from the definition of the 'Industry - Rural' use class.
[23] Newco Mills [92].
The Applicant refers to seven specific aspects of Harvis Capital and Newco Mills, as follows.
Firstly, the references to:
(a)'goods' in the definition of 'industry'; and
(b)'rural products' in the definition of 'industry - rural' (as a narrower class of such 'goods'),
refers to either the inputs (being the things that the activities are undertaken on) or the outputs (that is, the things that the activities are undertaken to produce).
That is to say, having regard to context, that the activities may be undertaken on 'rural products', or the activities may be undertaken to produce 'rural products'.[24]
[24] Newco Mills [50]; see also [74].
Accordingly, to the extent that decisions such as Attwell and Ecogrowth, as well as Castle and City of Rockingham,[25] suggest or infer that the inputs upon which the activities are undertaken must themselves be 'rural products', these decisions can no longer be regarded as good law.
[25] Castle and City of Rockingham [2018] WASAT 98.
Secondly, it is not appropriate to focus solely on the 'rural product' aspect of the use class. What is encompassed by the definition of 'industry-rural' use class must be understood by reference to the totality of the composite phrase that comprises the definition.[26]
[26] Harvis Capital [77], [86]; considered in Newco Mills [103] and [112].
Thirdly, within the totality of the composite phrase, 'rural products' relatively means:[27]
As for the term 'rural products', the meaning of the term 'product' includes 'a thing generated or produced by, or as if by, nature or a natural process' and 'an object produced by a particular action or process; the result of mental or physical work or effort'. The meaning of the adjective 'rural', in the context of this use class, is 'carried out in or involving the country as opposed to a town or city; pastoral, agricultural'.
[27] Newco Mills [73] (internal citations omitted).
Fourthly, the meaning of the terms 'handling', 'treating', 'processing' and 'packing', as the activities that are included as part of the 'industry - rural' use‑class. Newco Mills includes the following:[28]
54The meaning of the word 'processing' encompasses 'to operate on mechanically or chemically; specifically to preserve or alter (food, a foodstuff, etc.)'; 'to deal with something, especially according to an established procedure'; and 'to convert (an agricultural commodity) into marketable form by some special process'. So, for example, fresh fruit may be processed into dried fruit by subjecting it to dehydration using dehydrators or ovens. According to the Macquarie Dictionary, the meaning of the verb 'process' also includes 'to treat or prepare by some particular process, as in manufacturing'. That is not a particularly helpful definition, because the definition incorporates the very word it seeks to define. However, as I understand that meaning, it alludes to the fact that the various steps which may be involved in manufacturing a good may also include processes. That does not mean that those processes themselves equate to manufacturing, but rather recognises that individual acts of processing may contribute, ultimately, to the manufacture of something.
…
69The word 'handling' is a derivative of 'handle', which has a number of meanings. In the present context, those most apt include 'to touch or feel with the hand or hands; to pick up, hold, turn over, etc, in the hand or hands; to use the hands on for some purpose', and 'to deal with, treat; to subject to some process or operation'.
70The word 'treating' when used as a derivative of the verb 'treat', as it is here, has a number of meanings, the most apt of which is 'to "use" (well, ill, properly, reverently, etc)', 'to deal with in order to effect some particular result' or 'to subject to chemical or other physical action; to act upon with some agent'.
71As I have already noted, the meaning of the word 'processing', a derivative of the verb 'process' means 'to operate on mechanically or chemically, specifically to preserve or alter (food, foodstuffs, etc.)'; 'to deal with (something), especially according to an established procedure'; and 'to convert (an agricultural commodity) into marketable form by some special process'. In the context where the drafter of the Scheme was endeavouring to identify industrial operations which could be undertaken within the General Rural zone of the Scheme, and which would be consistent with the objectives of that zone, the meanings of 'processing' which relate to the conversion, using established procedures, of rural products into marketable forms, are most apt.
72The word 'packing', when used as a derivative of the verb 'pack' has a variety of meanings. In the present context, those most apt include 'to place (foodstuffs or other perishable goods, originally fish) together tightly in a sealable container, esp. for transport, storage, or subsequent sale. Also: to fill (a sealable container) with foodstuffs'; 'to place (items of any kind) in a container, esp. for transport; and 'to wrap and tie (goods, clothes, etc.) in cloth, canvas, or other material, so as to form a pack, bale, or parcel; to bundle or parcel up'. (Citation omitted)
[28] Newco Mills [54], [69], [70], [71] and [72] (internal citations omitted).
Fifthly, the meaning of terms describing other activities as part of the definition of 'industry', but which are excluded from the 'industry - rural', in particular the meaning of 'manufacture' and 'assembly' was described as follows in Newco Mills:[29]
52The ordinary meaning of the verb 'manufacture' encompasses making products or goods out of raw materials to produce other goods, using physical labour or machinery, especially on a large scale, and converting raw materials or ingredients into a specified product; and 'to make or produce by hand or machinery, especially on a large scale'. So, for example, steel is manufactured by combining iron and carbon at very high temperatures in furnaces, and once in a liquid (molten) form it is cast into shapes, and after it cools and hardens it can be worked, using machinery, into sheets, bars, pipes, blocks and wires.
53The meaning of 'assembly,' a derivative of 'assemble,' includes to put together (as in the separately manufactured parts of a composite machine or mechanical appliance); and 'the putting together of complex machinery, [such] as aeroplanes, from interchangeable parts of standard dimensions'. So, an assembly line in a car factory involves a process where each component of a car is put together to make the whole car.
[29] Newco Mills [52] and [53] (internal citations omitted).
Sixthly, that there is a degree of overlap between several types of activities, particularly between the activities of 'manufacturing', 'processing' and 'assembly', but they are not synonymous. Newco Mills provides as follows:[30]
I pause there to observe that each of those activities - manufacture, processing, assembly - has some similarity, and there may be some overlap between them, but they are clearly not synonymous. For example, manufacturing a car involves, in part, assembling all of the individual components, but manufacturing a car involves much more than the assembly of component parts. Manufacturing a car starts with manufacturing each of its individual components, from the raw products used to make them (such as by manufacturing steel). Similarly, making those individual components may involve some elements of processing, for example, by working steel or steel alloy into various shapes which can then be welded together to make the chassis of the car. But manufacturing the car involves far more than merely processing those individual pieces.
[30] Newco Mills [55]. Similar comments were made by Allanson J in Harvis Capital [85] and [86].
Seventhly, that the construction of a use‑class definition must take into account the broader context in which it appears, including the scheme and zoning objectives in which the use-class is permissible (and prohibited) as well as the range of permissible (and prohibited) uses classes in the relevant zone.[31] That is to say, the interpretation and construction of the, relevantly, 'industry - rural' use class should be consistent with those objectives, rather than undermine them. In Newco Mills, Pritchard J explained that:[32]
Those objectives clearly indicate that the planning objectives applicable to the General Rural zone seek to strike a balance between facilitating productive rural activities which will contribute to the economic base of the region, on the one hand, while on the other hand, ensuring that the rural amenity and character of the location, and the preservation of the land's capability is not prejudiced. The manufacture of goods is more likely to take place in large premises, such as factories and plants, which are suitable for the production of goods from raw materials on a large scale, using machinery. It is not difficult to envisage that in addition to the visual amenity of such premises, noise and traffic associated with factories and plants conducting manufacturing operations may be more likely to detract from the rural amenity of a location. For that reason, to construe the definition of the use class 'Industry ‑ rural' broadly, so as to encompass all of the activities included within the definition of 'industry', especially manufacturing, would be more likely to prejudice rural amenity, and to detract from, rather than to promote, the enhancement of the rural character of an area, and in that way would be contrary to the objectives of the General Rural zone.
[31] Newco Mills [84] to [91]; Harvis Capital [80] to [82].
[32] Newco Mills [91].
Finally, one of the differences between the scheme under consideration in Newco Mills and the Scheme, is that the scheme in Newco Mills did not contain any definition of the term 'premises' as it appears in the definition of the term 'industry' (and as incorporation as part of the definition of the 'industry ‑ rural' use class). Pritchard J noted, by reference to the ordinary meaning of the term 'premises' that:[33]
The definition of 'industry' in the [City of Swan LPS 17] … thus contemplates that activities in connection with a particular industry will usually be undertaken in buildings.
[33] Newco Mills [49].
In this instance, the Scheme defines 'premises' as meaning 'land or buildings'.
The proposed development produces a 'rural product'
In the context of the proposed development, it is accepted that the inputs into the compost (biosolids and green waste) are not 'rural products'. However, by reason of Newco Mills, it is not necessary for them to be so.
However, the output of the composting process is itself a 'rural product', particularly having regard to the proposed development. As such, this case is distinguishable from Attwell where limestone bricks were found not to be a rural product. The output can also be distinguished from the fertilisers the focus of Ecogrowth where the Tribunal specifically referred to evidence that:[34]
… the organic fertilisers handled, treated, processed and packed at the site are used not only for agricultural purposes … but also for turf, grass and home gardens. Moreover, the evidence shows that certain of the products that are recommended on Ecogrowth's website for use for agricultural purposes are also recommended and sold for non-agricultural purposes and, in particular, for use on turf, grass and home gardens. These products are distributed through a number of garden businesses in the Perth region and landscaping businesses elsewhere.
[34] Ecogrowth [30].
The Tribunal then concluded:[35]
I find that, on the evidence presented, organic fertiliser is not a 'rural product'; meaning that it is not something produced of, or relating to, or characteristic of the country (as distinguished from towns or cities), or of or relating to agriculture. The conclusion may well be different if there were something about the nature of the product, or the way in which it is packaged and distributed, which would reasonably preclude it from being used for any purpose other than an agricultural purpose[.]
[35] Ecogrowth [33].
In the present case, an aspect of the proposed development is that the resultant product (the compost) is not to be sold or distributed, but is only to be used on the land, or on other farming lots (on rural zoned land) owned or leased by the same landowner so as to improve the agricultural capacity of these farms.
There was no finding in Newco Mills nor Harvis Capital as to whether the stock or animal feed products produced by the proposed feed mills were a 'rural product'; but there was no suggestion they were not. In both instances, it was unnecessary to address the question because the activities were found to fall outside the 'industry - rural' use class.
The proposed development does not involve 'manufacturing'
The proposals in HarvisCapital and Newco Mills involved similar, though not identical, developments, being animal or stock feed mills. The operational details of each are set out in the respective judgments.[36] It was these operational details that were crucial in both cases where the activities that comprised each of the proposed developments were found not be 'industry - rural' uses.
[36] Harvis Capital [20] to [24]; Newco Mills [13] to [18].
In Harvis Capital, Allanson J concluded that:[37]
The composite phrase, 'an industry handling, treating, processing or packing rural products' refers to processes which occur in, or may be part of, manufacture. But processing and manufacture are not synonymous. The fact that different products are combined and treated would not necessarily exclude the feed mill operation from being described as treating and processing rural products. But the whole operation described in the application - milling, mixing to mash, manufacture into pellets, crumbling and coating - is more than treating and processing the grains and meals. It is the manufacture of a separate product.
[37] Harvis Capital [86].
In Newco Mills, Pritchard J concluded as follows:[38]
[38] Newco Mills [121] - [122].
121However, the proposed development as a whole must be considered, rather than individual components of it, in isolation from each other. Having regard to the proper construction of the terms handling, treating, processing and packing, there is no doubt that the proposed development overall cannot be described as involving merely those activities, having regard to the following:
(a)While grains and seeds may be the main ingredients, by volume, in the animal feed pellets and animal muesli, other ingredients, namely either vitamins and minerals, or oil and molasses, are then mixed with the grains and seeds;
(b)the objective in adding other ingredients is to create a product which is different from, and superior for achieving its purpose as feed for particular species of animals, than the individual types of grains or seeds themselves;
(c)the products which are made - the animal feed pellets and animal muesli - are quite different from the grains and seeds which went into them;
(d)the production of the animal pellets and animal muesli would clearly involve the use of machinery on what would be a large scale.
122In my view, while the production of the animal pellet and animal muesli involves a number of steps, some of which can properly be described as processing, when viewed as a whole, the proposed development is properly described as involving the manufacture of animal feed products. Consequently, in my view, the proposed development does not fall within the activities permitted by the use class 'Industry - Rural'.
The operational details, being the activities, that comprise the proposed development stand in contrast to the stock feed mills proposed in HarvisCapital and Newco Mills:
(a)the inputs in the process are simply placed on the ground in windrows;
(b)the mechanism by which the inputs become the output or finished product is an entirely natural process; it occurs naturally and is not reliant on any artificial or external activity imposed on, or applied to, the inputs;
(c)the only physical activity applied to the inputs is to mix them and regularly turn over the materials; so as to speed up that natural process;
(d)what results from that process is not a 'new or different product' in the same sense that the feed pellets were a new and different product to the grains etc that were the inputs in Newco Mills and Harvis Capital - it is simply the basic, decomposed form of the inputs; and
(e)while the resultant product is superior in some respects for achieving its purpose of enhancing the agricultural capacity of land than if the individual inputs were applied separately, this is as a result of the natural decomposing process rather that the artificial creation of an entirely different product.
Both Newco Mills and Harvis Capital suggest that the proper characterisation of the activities associated with a proposal involves 'a judgment, having regard to the entirety of the proposed development'.[39] Consequently, in the context of the proposed development, the proposed activities ought to be properly characterised as involving 'processing', 'handling' or 'treating' undertaken to produce a 'rural product'. That is to say, the process, viewed as a whole, does not involve manufacturing.
The planning context
[39] Newco Mills [114].
A conclusion that the proposed development falls within the meaning of 'industry - rural', and is therefore a permissible use, is also supported by the evidence of Mr Joe Algeri, a planner called on behalf of the Applicant, who explains that:[40]
(a)the proposed development involves no 'factory'; it is merely an area of open ground;
(b)the only machinery involved is similar to the type of machinery that is ordinarily used in agricultural activities;
(c)limited vehicle movements are generated, similar to the volume associated with other forms of agricultural activities; and
(d)there are limited employees involved, again similar to other agricultural operations.
[40] Exhibit 12, para 97.
Pointing to the evidence of Mr Algeri, the Applicant submits the proposed development is consistent with the objectives of the Rural Zone because, inter alia:
(a)it supports the continuation of broad-hectare agricultural as the principal land use in the locality and results in improved soil quality;
(b)by reason of its scale, it retains the rural character and amenity of the locality; and
(c)it will not be detrimental to the natural resources nor the environment.
Because it is intrinsically linked with, and beneficial to, agricultural operations, Mr Algeri considers that the proposed development is consistent with the objectives of the Rural Zone. Mr Algeri notes that a wide range of non-rural uses are permissible in the Rural Zone, such as:
(a)car park;
(b)caravan park;
(c)civic use;
(d)club premises;
(e)corrective institution;
(f)educational establishment;
(g)hospital;
(h)service station; and
(i)tavern.
Mr Algeri considers that the proposed development is 'more rural' than many of the permissible land uses listed above.
In terms of likely amenity impacts, there is nothing in terms of the nature of any potential impact that is inconsistent with a finding that the proposed development falls within the proper construction of the 'industry - rural' use class and is, therefore, a permissible use.
Consideration
The debate between the parties as to the proper classification of the proposed development focused on two key questions. The first is the characterisation of the activities involved in making the compost and, in particular, whether that process involves 'manufacturing'. The second is whether the compost is a 'rural product' for the purposes of the Scheme.
It is not in contest that in order to be an 'industry - rural':
(a)the process by which the compost is produced cannot be characterised as 'manufacturing'; and
(b)the resultant compost must be a 'rural product'.
Some general observations of the 'industry-rural' use class
The question of land use classification focuses attention on the activities that will comprise a proposed development, together with any associated structures, having regard to the context of the land in question against the backdrop of the applicable planning framework.
Before I proceed further, I make the following general observations.
Firstly, having regard to the overarching definition of 'industry' in the Scheme, it is apparent that the 'industry - rural' use class encompasses a significantly narrower band of activities than the more generic 'industry - general' land use. Likewise, it is a use class relating only to 'rural products', not the broader range of 'goods, products, articles, materials or substances' that are the focus, or product, of general industrial uses.
Therefore, as a matter of context, the drafter of the Scheme has deliberately sought to limit both the range of activities, and the nature of the goods, that comprise the 'industry - rural' use class. In my view, that does not encourage an expansive view to be taken of the types of industries that will properly be classified as 'industry - rural' under the Scheme. That is to say, the drafter has taken some care to limit the scope of the 'industrial - rural' use class.
Secondly, having regard to the definition of 'industry - rural', and its permissibility across the various zones in the Scheme, it can reasonably be inferred that it is a land use that is intended to be carefully controlled and regulated. The same could be said of all the industrial categories of land use identified in the Scheme. This close regulation is plainly to ensure that land use conflicts between industrial and other, more sensitive land uses, is carefully managed.
In fact, 'industry - rural' is not a permitted land use in any zone, including in the Industrial Zone. Indeed, it is only permissible in two zones, being the Industrial Zone and the Rural Zone; both as 'discretionary (D)' uses.[41]
[41] Scheme, cl 4.3.2 provides that a 'discretionary' use is a use that is not permitted unless the local government has exercised its discretion and granted development approval.
Thirdly, having regard to the Scheme definitions, particularly the various categories of industrial land uses, and their associated activities, identified in the Scheme, the apparent underlying town planning intent of the 'industry - rural' land use is to allow some industrial activities to occur in the rural parts of the district (on Rural zoned land) or otherwise to be located on industrial zoned land.
Fourthly, a range of industrial land uses are capable of approval in the Rural Zone including: 'industry - extractive', 'industry - cottage', 'industry - mining' and 'industry - rural'. The capacity for these uses to be located in the Rural Zone indicates that non-agricultural, including industrial, activities are plainly contemplated in these rural localities.
Fifthly, and as noted by Mr Algeri, there is also capacity for a wide range of other non-rural uses to be located in such areas. This no doubt reflects the fact that rural localities are essentially productive areas that contribute to the economic base of these regions. However, at the same time, the contemplation of non-rural uses needs to be balanced against considerations such as rural amenity and character. These considerations are reflected in the objectives for the Rural Zone.
Sixthly, notwithstanding the above analysis, the core focus of the Rural Zone remains on rural and agricultural uses. That is plain from the zoning objectives,[42] which refer to broad-hectare farming remaining the 'principal' land use, but also by reference to the zoning table. In accordance with the zoning table, the only 'permitted'[43] land uses within the Rural zone of any real consequence[44] are 'agroforestry' and 'rural pursuit', both of which are land uses focused on agricultural activities.
Some general principles of construction
[42] Refer [27] above.
[43] Scheme, cl 4.3.2 provides that a 'permitted' use is a use permitted by the Scheme provided the use complies with the relevant development standards and requirements.
[44] Leaving to the side land uses such as 'single house', 'ancillary accommodation', 'home occupation', 'home office' and 'home store'. 'Civic use' means, in effect, premises used by a government department for administrative recreational or other uses.
Following Harvis Capital and Newco Mills, this is yet another case where the range of scope of the 'industry-rural' land use falls to be considered. The following principles arise from these authorities:
Firstly, the proposed development is to be construed:
(a)in an overall sense and not in a piecemeal fashion; and
(b)taking account of the entirety of the composite phrase that comprises the definition, without undue focus on individual words divorced from this wider context.
Secondly, in order to fall within the 'industry - rural' use class, the activities that comprise the proposed development must involve one or more of the following activities, being 'handling, treating, processing or packing'.
Thirdly, the activities must relate to a 'rural product'. The term 'rural product' takes it meaning from its context. Consistent with Newco Mills, the term in this context means a 'product' that is generated or produced naturally or as a result of mental or physical work or effort. The product itself must be 'rural', an adjective meaning 'carried out in or involving the country as opposed to a town or city'.
Fourthly, decisions such as Attwell and Ecogrowth need to be contemplated in the light of the more recent decisions in HarvisCapital and Newco Mills. That is to say, these more recent authorities confirm that the 'rural product' may either be an input, or an output, of the 'handling, treating, processing or packing' activities.
Fifthly, as I have stated, in order to be properly classified as an 'industry - rural', the activities involved in the proposed development cannot be characterised as 'manufacturing'. While there is a degree of overlap between activities such as 'manufacturing', 'processing' and assembly', the terms are not synonymous.
Why the proposed development does not involve a rural product
It is not in contest that in order to be an 'industry - rural', the proposed development must involve a 'rural product'. While the 'rural product' may either be an input into, or the product of, the various activities that comprise the 'industry - rural' use class, the process itself must sufficiently engage with, or involve, a 'rural product'.
The Applicant's case is that while the biosolids and the green waste are not rural products, the resultant compost that is produced is. That is so because the compost will only be used on the land or otherwise as part of the Applicant's agricultural operations.
In this sense, the Applicant relies on the comments made in Ecogrowth that the result in that case may have been different if there was evidence that the manner in which a product was distributed reasonably precludes it from being used for non-agricultural purposes.[45] Here, the Applicant suggests that the manner in which the compost will be used or applied makes it a 'rural product' for the purposes of the Scheme.
[45] Ecogrowth [33].
For the following reasons, I disagree.
Firstly, in my view, the question as to what is a 'rural product' is to be determined in an objective sense, having regard to the inherent nature of that product, and not by reference to the subjective intentions of as to how a particular proponent intends to make use of, or apply, it. That is so because, if that were the case, the permissibility of the use as an 'industry - rural' use would then rest too heavily on compliance with approval conditions limiting or restricting the ordinary use of that product.
Secondly, it is accepted law that planning conditions should address only incidental aspects of a proposed development.[46] Likewise, planning conditions should not be deployed to convert an unacceptable or otherwise prohibited development into one that is acceptable.[47] Furthermore, as the Tribunal made clear in G & G Corp, approval conditions cannot be deployed so as to convert a prohibited use into a use capable of approval nor to make a use an incidental use that does not need approval.[48]
[46] KIPA Freeholds Pty Ltd v Development Assessment Commission (1999) 101 LGERA 414 [39] (Debelle J).
[47] Ursula Frayne Catholic College and Town of Victoria Park [2020] WASAT 17; (2020) 99 SR (WA) 76 [187] - [195]; Remove-All-Rubbish v City of Salisbury (1989) 51 SASR 26 [34] (Jacobs J); Drummoyne Municipal Council v Maritime Services Board (1991) 72 LGRA 186, 192 (Stein J).
[48] G & G Corp [51].
Here, the mere fact that the Applicant intends to use the compost on its own operations cannot have the effect of converting that product to be a 'rural product' for the purposes of classifying the land use. Either compost is a rural product, or it is not.
Thirdly, and following on from above, it is necessary to take account of the direction given by the Court of Appeal that planning schemes must be interpreted in a manner that is comprehensible not only to lawyers and planners, but also by the community generally. Placing a counter-intuitive judicial gloss on the plain meaning of terms is not an approach to be encouraged.[49] Likewise, planning schemes should be construed broadly, rather than pedantically and with a sensible practical approach.[50]
[49] Australian Unity Property Ltd v City of Busselton [2018] WASCA 38; (2018) 237 LGERA 333 [82] (Buss P, Murphy and Mitchell JJA).
[50] Sanders v City of South Perth [2019] WASC 226 [99] (Quinlan CJ).
The proposition that a 'product' is a 'rural product' in some instances, for the purposes of a land use classification exercise, but not in others is hardly ideal as it reduces the ability of the community to understand with any clarity the planning laws which govern the use of their land. Nor can such an approach be said to be a 'sensible practical approach'.
Fourthly, the Applicant's approach to the construction of the Scheme would, I find, produce arbitrary planning outcomes. That is so because the classification of land uses would turn on how particular proponents intend to use, or to limit the use of, a product, so as to make that product a 'rural product'. The object and purpose of the PD Act, under which any local planning schemes are made, is to provide for an efficient and effective land use planning system in the State.[51]
[51] PD Act, s 3(1)(b); see Humich Nominees Pty Ltd v Metro East Joint Development Assessment Panel [2019] WASC 200 [98] - [99] (Smith J).
An arbitrary approach to land use classification, based on land uses that unduly restrict the ordinary application of products, does not align with this statutory purpose. Moreover, as I have already explained, it would render the planning system incomprehensible and confusing to the broader community.
Fifthly, this is not to say that an agricultural operation should not be able to produce compost for its own use. One can readily imagine, as Mr Algeri spoke to, it would be very common for agricultural operations to indeed produce their own compost.[52] In such instances, the composting is an incidental aspect of that agricultural operation and as such would not require development approval.[53]
[52] ts 109, 15 October 2024.
[53] G & G Corp [17].
However, that is not what is pressed for here. The Applicant does not present the proposed development as an inherent part of an agricultural operation. Rather it is seeking to truck in significant volumes of human waste (biosolids) from another municipal area to mix with green waste and to decompose those combined materials to produce the compost. While the compost will not have commercial application per se, the proposed development is a commercial enterprise involving the receiving and processing of biosolids.
Sixthly, the Applicant applied for what it termed a 'compost site'.[54] In its grounds for review, the Applicant describes the proposed development as a 'compost manufacturing and soil blending facility'. The manner in which the compost is to be used or applied is not directly addressed on the development application form itself, but only emerges later in the Development Report where it states that the compost will not be sold but will be used by the Applicant or its subsidiaries.[55]
[54] Dated 7 May 2023 and included in the Application for Review.
[55] Respondent's Bundle, page 34; refer [18] above.
The reality is, I find, that the Applicant sought approval for a composting facility, as a basis on which the biosolids it has contracted to receive from the Water Corporation may be treated. That is plain from the application materials, read fairly and as a whole. The use or application of the compost, while referred to in the materials, was, I find, but a device to make the compost a 'rural product' for the purposes of securing a development approval.
In its oral submissions, the Applicant 'had no difficulty' with an approval condition restricting the use that may be made of the compost to align with its stated intentions.[56] Indeed, I consider that such a condition would be a fundamental requirement of any approval, because, even on the Applicant's case, ongoing compliance with that requirement would be the only basis on which the compost would remain a 'rural product', and thus the proposed development would continue to be an 'industry - rural'.
[56] ts 133, 16 October 2024.
In my view, the classification of a land use such as 'industry - rural' should not hinge on approval conditions, particularly those of an enduring nature, which unduly serve to restrict or limit the ordinary use of the 'rural product'. As I have stated, it is contrary to the principles of planning law to impose conditions to be deployed to restrict the use of a product so as to make it a 'rural product' for the purposes of land use classification. Nor should the manner in which a product is to be used or applied serve to dictate and control the land use classification exercise.
Seventhly, if the Applicant's approach is correct, it would lead to some irrational, indeed bizarre, planning outcomes. For example, a petrol distribution business, which involves the 'handling' of petrol, could be classified as an 'industry - rural' if the business agreed to approval conditions to only distribute the petrol to farming or agricultural operations.
That is so because, if the Applicant's argument were accepted, the petrol could then be characterised as a 'rural product' because the distribution business would be 'carried out'[57] in a rural area and also because of the manner in which the petrol is applied or used by that operator. That is to say, much like the compost here, that operator's limited use of the petrol would serve to make the petrol a 'rural product' because it would only be used in the context of supporting, or as an aspect of, farming or agricultural activities.
[57] Newco Mills [73].
Reading and applying the Scheme in a practical and common-sense manner, and consistent with its town planning purpose, not every industrial activity that is carried out in a rural area can have the effect of making the relevant 'product' a 'rural product', on the basis that the product would only be applied to agricultural activities, such that the use becomes 'industry - rural'. As Newco Mills and Harvis Capital make clear, what is required is for the entirety of the composite phrase that comprises the land use to be considered, in the context of the applicable facts, and an evaluative judgment made thereon.[58]
[58] Newco Mills [114].
In my view, compost, like petrol, is not, by its nature, a rural product and cannot be converted into one by a planning condition restricting its use or application. Compost can be produced in any given context, including in suburban backyards. While compost is the result of a natural or organic process, it is not a product that is inherently or ordinarily regarded as being rural in nature. There is nothing on the evidence before me to suggest otherwise. In the language of Newco Mills, it is not a product that '[involves] the country as opposed to a town or city'. I find that the compost is not a rural product for the purposes of the Scheme.
As was also canvassed in the evidence, and as Mr Algeri properly conceded,[59] if an identical operation to the proposed development was established on a neighbouring property, but with the compost being sold at a nursery instead, that operation would not be an 'industry - rural' under the Scheme. From a land use planning perspective, such an outcome makes little sense.
[59] ts 110, 15 October 2024.
My point being, consistent with the Respondent's submissions, is that if the Applicant is correct, numerous non-rural products could become 'rural products' if the application or use of such products is limited, by way of development approval conditions, to being associated with, or being used as part of, rural or agricultural activities. In my view, cannot have been the intent or purpose of the 'industry - rural' use class.
Eighthly, it is also the case that the Tribunal's comments in Ecogrowth need to be carefully considered. In its analysis, the Tribunal suggested that any restriction on the use or application of a product would need to be 'reasonable' in order to be satisfied that the product was, in fact, a 'rural product'. The Tribunal did not elaborate on what kinds of restrictions would be regarded as 'reasonable'. However, having regard to the principles of planning law, I do not consider that reliance on a planning condition to make a product a 'rural product' is reasonable.
Ninthly, in my view, approval of the proposed development would fundamentally distort the intent of the 'industry ‑ rural' land use. The Scheme is a written law and needs to be construed in accordance with the orthodox canons of construction, including its evident legislative purpose. That purpose is a town planning purpose of, inter alia, controlling and regulating the 'development' of land.[60]
[60] Landcorp and City of Stirling [2011] WASAT 202 [44].
As its name suggests, the 'industry - rural' use class is directed to providing for some industrial activities (being 'handling, treating, processing or packing') in the context of a 'rural product'. Such activities are permissible only on rural zoned land or otherwise must be located in an industrial area.
That is to say, the town planning purpose of the 'industry - rural' use class is to allow the prospect of some industrial activities to either 'handle, treat, process or pack' a 'rural product', and/or to produce, a 'rural product' in rural localities. This provides the opportunity for some industrial processes to be undertaken in the localities in which rural products are either naturally sourced or which are produced by human intervention and effort associated with rural or agricultural pursuits. Otherwise, in the context of the Scheme, such uses will need to be located in the Industrial Zone. I note here that the only Industry Zone in the Scheme is located in the township of Darkan.
To explain why, in my view, the proposed development impermissibly distorts the intent of the 'industry - rural' use, I need identify the types of uses that I consider the drafting of the Schemes contemplates in this use class.
For example, and without in any way intending to provide an exhaustive analysis, the handling and packing of timber would likely be a rural industry, as would the production of milk, cheese, yogurt or wine. The production of apple or orange juice also would likely be a rural industry, as would a business making jam or preserves. Newco Mills identified a further example, being the drying or packaging of fruit. In each of these instances, the industrial activities and the consequent product of those activities, has an association with, or arises from, a recognised rural or farming activity, such as a dairy farm, a vineyard or an orchard.
Likewise, other rural products may occur naturally, absent any human intervention, which may then also support, or be the basis of, an 'industry - rural' land use. For example, a business picking and packing wildflowers would be an industry rural for the purposes of the Scheme. The same could be said of a business picking and packing truffles.
The permissibility of 'industry - rural' land uses on rural and agricultural lands make town planning sense, as it provides the opportunity for rural products to be handled, treated, processed or packed in close proximity to where those rural products are, ordinarily at least, harvested or produced.
Accordingly, in my view, the 'industry - rural' land use is plainly a use class that is intended to provide the opportunity for value-adding activities to be conducted in rural localities on rural zoned land. As a result, it is a use-class that provides for local employment opportunities in rural communities to add value to 'rural products', being products ordinarily sourced or produced in these areas, so as to contribute to the economic base of such regions.
I accept, as I must, that Harvis Capital and Newco Mills make it clear that products that may be regarded as 'non rural' products can be either the inputs into, or the ultimate product of, the industrial activities that comprise the 'industry - rural' use class. However, as I have explained, a land use that combines human and green waste to produce compost does not involve a 'rural product' for the purposes of the 'industry - rural' land use. That is to say, on the evidence before me, neither the inputs, nor the output, from this process are 'rural products' for the purposes of the Scheme.
In his closing address, Mr Slarke, counsel for the Shire, made the following submission:[61]
… compost is not something which is characteristic of the country. It's used in urban areas; it can be created in urban areas, and as Mr Algieri accepted that does happen.
So the fact that the applicant proposes to use the compost it produces, in this case only for soil conditioning on the landowner's properties, we say doesn't convert the compost into a rural product. Because it's the nature of the product which is determinative, not a quirk of the application which might limit the location of its use. If the location of the sales or use of the product in this particular case was determinative, that would create inconsistencies which are irrational.
[61] ts 117, 16 October 2024.
I agree.
Because, contrary to the Applicant's case, I have found that the compost is not a 'rural product' for the purposes of the Scheme, there is no basis on which the proposed development can be properly classified as an 'industry - rural'. For this reason, it is unnecessary for me to address the residual question of whether the activities associated with the proposed development involve 'manufacturing' in the sense contemplated in HarvisCapital and Newco Mills.
Accordingly, the correct and preferable decision is to affirm the decision under review. The application for review is dismissed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
DR S WILLEY, SENIOR MEMBER
6 MAY 2025
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