Alan Davis Media Limited v Leichhardt Municipal Council (5 June 1998)

[1998] NSWLEC 2

Land and Environment Court

of New South Wales

CITATION:	ALAN DAVIS MEDIA LIMITED v. LEICHHARDT MUNICIPAL COUNCIL (5 June 1998) [1998] NSWLEC 2
PARTIES:	Applicant: ALAN DAVIS MEDIA LIMITED Respondent: LEICHHARDT MUNICIPAL COUNCIL
FILE NUMBER(S):	10820 of 1997
CORAM:	Sheahan J
KEY ISSUES:	:-
LEGISLATION CITED:	Environmental Planning & Assessment Act 1979 Local Government Act 1919 Leichhardt Local Environmental Plan No.20
CASES CITED:	Narilu Superannuation Fund v Leichhardt Municipal Council, Matter 10348 of 1983; Council of the Municipality of Leichhardt v Saleh & Anor; Parramatta City Council v Bolton 33 LGRA p.303 ; Blance v Leichhardt Council; Outdoor Australia Pty Ltd v Auburn Council (1996) 89 LGERA 365
DATES OF HEARING:	14 May 1998
DATE OF JUDGMENT:	06/05/1998
LEGAL REPRESENTATIVES:	Mr J Snelgrove of John Snelgrove & Partners Pike Pike & Fenwick

JUDGMENT:

Contents

Introduction 1

The Proposal 2

This Appeal and the Question of Law 4

Previous Cases involving Clause 15 6

Consideration 13

The Question of Costs 14

Orders 15

IN THE LAND AND Matter No: 10820 of 1997

ENVIRONMENT COURT Coram: Sheahan J

OF NEW SOUTH WALES 5 June 1998

ALAN DAVIS MEDIA LIMITED

Applicant

v

LEICHHARDT MUNICIPAL COUNCIL

Respondent

JUDGMENT

Introduction

This judgment concerns a Question of Law posed for determination prior to the consideration by the Court of an appeal under section 97 of the Environmental Planning & Assessment Act 1979 (“the EPAA”) against a decision by Leichhardt Municipal Council (“the Council”), refusing an application to allow a sign to be erected on the external wall of a building within the municipality.

The relevant development application and notice of refusal were attached to the Class 1 application filed on 24 December 1997, and are also in evidence as Exhibit A3 , which also includes the report of Council officers.

The subject building is known as the Merton Estate Hotel, and the application lodged 28 August 1996 sought approval to erect an illuminated advertising billboard on the upper portion of the western wall of the hotel building, which is located at 38 Victoria Road, Rozelle.

The property is owned by Evenflare Pty Limited which signified by letter dated 2 July 1996 its consent to the lodgment of the development application (DA 368/96) which was lodged on 28 August 1996.

The Proposal

The proposed billboard is defined as an “advertising structure” under the relevant planning instrument, and the site, zoned Residential 2(b2) under Leichhardt Local Environmental Plan No.20 (“LEP 20”) is located within the Rozelle Conservation area.

The sign will be 10 metres wide and 3.3 metres high and it is proposed to be illuminated by two 400 watt halophane lights mounted at the bottom of the sign. There are four existing advertising structures above the awning on the building which, it is proposed, will be removed as part of the development application.

The relevant Council officers’ report says “in view of the existing signage in the area and the location of the proposed billboard, the proposal is considered to be a compatible development with the existing developments in the locale”.

The officers expressed the view that the proposal complied with Council’s relevant draft development control plan (“DCP 12”) on the subject of outdoor advertising, and recommended approval for a period of 3 years subject to minor conditions.

In the Statement of Environmental Effects lodged with Council in August 1996, Planning Overload Pty Limited, on behalf of the applicant, made the following relevant comments regarding the proposal (see Exhibit A1 ):

· the host building is a two-storey commercial hotel on the corner of Maney Street and Victoria Road and the site benefits from being within a commercial environment. There is also a range of advertising signs of various forms and functions in this commercial environment.

· the proposal is part of, and will help finance, the general upgrade of the hotel.

· the location of the proposed sign was selected so that it was within the western wall and will not add to the existing building, nor building bulk. Its location is consistent with the best practice urban design guidelines.

· the size of the sign is consistent with the scale of the wall and host building. The overall advertising area of approximately 42 square metres is consistent with the size and area of advertising panels in this part of Victoria Road.

· the general advertising panel will change its message periodically.

· the proposal complements the architectural design because it is an identified sign panel and does not interfere with architectural features on adjoining buildings.

· the sign proposal cannot be seen from any residential properties and is consistent with adjoining and nearby commercial zones.

· the proposal does not restrain any future development of the site for residential or other purposes.

· the Statement of Environmental Effects argues that the site is one for which cl 15 of LEP 20 was designed.

The Council resolved to refuse consent, and the applicant was so advised on 18 February 1997. The stated reasons for refusal were:

1. The sign’s size is considered to be excessive.

2. The sign extends beyond the building envelope.

3. The sign will have a detrimental effect on the existing Rozelle skyline.

This Appeal and the Question of Law

An issues statement filed in the proceedings on 6 February 1998 included as No.1 of 6 issues raised:

“The sign is prohibited by virtue of the zoning and planning provisions under LEP 20”.

At callover, the Registrar noted that that issue raised a Question of Law and on 18 February 1998, solicitors for the Council formally raised the question of law for the Court’s determination in the following terms:

“Whether the proposed development at 38 Victoria Road, Rozelle is permissible pursuant to Clause 15 of Leichhardt Local Environmental Plan Number 20”.

As printed in LEP 20 ( Exhibit C2 ), cl 15 states as follows:

“Commercial use of non-residential buildings in residential zones

15. Where a building on land within Zone No.2(b1), 2(b2) or 2(b3) has been constructed for a use other than residential land, in the opinion of the Council -

(a) it is not suitable on physical or economic grounds for conversion to, or replacement by, a residential use; and

(b) the amenity of the locality will not be adversely affected,

the council may consent to the use of the building or part of the building for any purpose included in Column III or IV of the Table to clause 22 of the Leichhardt Planning Scheme shown opposite Zone No.3(a1) in Column I of that Table.”

Zone No.3(a1) of the Leichhardt Planning Scheme Ordinance provides that advertising structures, amongst other things, are permissible with consent.

However, clause 8 of the LEP makes it clear that in Residential 2(b2) zones, advertising structures are prohibited , in that they are not included in the list of purposes for which development may be carried out without, or only with, development consent.

For the purpose of the application of cl 15 of LEP 20, the relevant definition of “advertising structure” is the definition of that term in the planning scheme ordinance, which adopts the meaning ascribed to it by ordinance 55 of the old Local Government Act 1919, namely “a structure used or to be used principally for the display of an advertisement”.

It seems to be agreed between the parties that the word “building”, as it occurs in cl 15, does not have the same meaning as it does under the EPAA, which defines “building” to include “a structure or a part of a structure”. Council submits that the word “building” in cl 15 refers to the building on the premises the subject of the application. In the current case, that would be the Merton Estate Hotel building.

Council argues that cl 15 is limited to the use of the building as an entirety and does not refer to something which is added structurally to it so as to expand or intensify the use.

The applicant submits that cl 15 deals with the building or part of the building and that the western wall of this particular building must be construed to be part of the building to which the advertising structure will be added, a purpose permissible in zone 3(a1).

There is no evidence before the Court as to the original reason for the construction of the building which is now known as the Merton Estate Hotel, but Council records show that it was used as a hotel as long ago as 1957, and the parties have asked the Court to assume that it was erected for that purpose.

Previous Cases involving Clause 15

Clause 15 has been dealt with by the Court on 4 previous occasions, concerning two properties.

(i) On 28 June 1984, in A R D’Angelo as Trustee for Narilu Superannuation Fund v Leichhardt Municipal Council , Matter 10348 of 1983, Unreported, 28 June 1984, (“ D’Angelo ”) Cripps J dealt with an application for permission to use the lower floor of a property at 186 Victoria Road, Balmain as a real estate agency and the upper floor as a solicitor’s office.

The property was zoned Residential 2(b2) under LEP 20. In May 1983 the then IDO 27 was amended by the insertion of cl 34 which, with some immaterial alterations, became cl 15 under LEP 20, which was made on 3 February 1984 and gazetted on 15 June 1984.

The building was a two-storey brick building, which until 1968 was used as a butcher shop and residence.

The purpose of the insertion of cl 34/15 was, in Cripps J’s words, “to permit a commercial use for premises meeting the description referred to in the clause”.

The Council took the view that, as part of the building had been constructed for residential use, cl 15 could not be applied to the application and, in any event, it had not been established that the building was not suitable on physical or economic grounds for conversion to a residential use.

It was clear that the building was not constructed exclusively for residential purposes.

Cripps J pointed out that the words at the opening of cl 15 do not include “or any part thereof”. He saw no reason to read down the clause, or its opening words. He interpreted the clause to mean that Council did not have to approve the whole of the building for a commercial purpose but may consent to the use of the whole or any part of it for that purpose.

He granted development consent, subject to conditions.

(ii) In Council of the Municipality of Leichhardt v Saleh & Anor , Cripps J again had to deal with 186 Victoria Road, Rozelle (Matter 40171 of 1986, Unreported, 5 December 1986) (“ Saleh ”), and he made the point that the use of the purposes for which he had earlier granted consent was prohibited by the zoning table, but authorised by cl 15.

On 17 June 1985, the Council modified the consent granted by the Court. On 15 April 1986, the Council granted building approval for the carrying out of the work referred to in that modification.

Inter alia, the Council submitted that the subject land “no longer enjoys the benefit of cl 15”, and, in assessing that submission, Cripps J said (pages 11-13):

“The purpose of cl.15 of LEP 20 is to mitigate the hardship of owners of land who had lost (or never had the opportunity to exploit) existing use rights in residential zones. The present case is an example of its application. At one time there may have been an existing use for the purpose other than dwelling. The premises were built as a shop and dwelling. But for many years the building was occupied by tenants or squatters. Clause 15 was designed to protect such buildings and to allow them to be used for other purposes provided the amenity of the locality would not be adversely effected and the building was not suitable for conversion to a residential use or the site suitable for re-erection for a residential property.

In Parramatta City Council v Bolton 33 LGRA p.303 the Court of Appeal held that the expression ‘existing building’ where appearing in cl.33 of the County of Cumberland Planning Scheme Ordinance required qualification to take account of changes (including rebuilding) that may have occurred since it first became an ‘existing building’. Clause 33 of the County of Cumberland Planning Scheme Ordinance provided that an existing building could be rebuilt. Hope JA observed that without such a qualification the purposes of the relevant clauses would be frustrated. In my opinion the reasoning in that case applies to the instant case. It is necessary to identify ‘the building’ referred to in cl. 15 to which the consent was attached. Is it the entire physical structure in existence at the date of the consent? Clearly not, because the consent itself envisaged the demolition of most of what was that building. In my opinion ‘the building’ is that which the building as renovated was to become and which was the subject of the consent. In my opinion ‘the building’ has not disappeared in the sense that there is nothing to which the consent can any longer attach. I would hold that opinion even if all the walls

had been demolished. If the Council’s submission be accepted, it means that if after the building was renovated in accordance with the consent as modified it was burnt down or destroyed by accident (or even if only the Victoria Street facade and the Moody Street wall were destroyed) then the building (or that part of it) could never be rebuilt. In my opinion such a construction of cl. 15 is neither desirable nor necessary. I should add, of course, that in the present case not all of that which was to be preserved has disappeared. A significant section viz. the western wall remains.”

He went on to say that he was not prepared to declare that the subject property no longer enjoyed the benefit of cl 15, nor that the consent he gave in D’Angelo had expired.

(iii) In matter No. 10147 of 1996, Blance v Leichhardt Council , Bignold J twice dealt with relevant matters involving cl 15. Firstly, on the question of law at the commencement of the hearing, and then in a considered judgment on a Class 1 appeal. (Unreported, 28 October 1996 and 23 December 1996) (“ Blance ”).

The applicant in that matter wished to rely upon cl 15 to support an application to extend the restaurant use being made of the first floor of the existing premises at 135 Rowntree Street, Balmain. (The restaurant is known as “Gotham”).

Although originally constructed as a hotel in about 1880, for many years the premises were used for mixed commercial and residential purposes, with commercial purposes being conducted on the ground floor and residential on the first.

The case concerned the unlawful use of the first floor premises, contrary to a condition requiring it to be used only as a single residence.

Bignold J identified that the use of the word “land” in the second line of the clause was obviously a grammatical, if not typographical, error and that the word should be “and”. This “amendment” was adopted by the parties.

Bignold J came to the view that cl 15 could be invoked by the applicant. The existing building was constructed in approximately 1880 for use as a licensed public house, then known as the “Waterview” Hotel. That single use involved the whole of the premises, including the first floor, which provided residential accommodation for the publican, his family, and the travelling public. Such residential accommodation was required to be provided as a condition of the then licensing laws.

Bignold J examined and followed D’Angelo , regarding it as implicit in Cripps decision that the statutory definition of “building” had been displaced. His Honour preferred to refer to the construction of a building as a whole, but to the use of the building in parts. He held that cl 15 was “capable of being invoked by the Applicant in the present case. Whether it is to be ultimately invoked by the exercise of the discretion conferred by the clause depends, of course, upon the fulfilment of the two conditions precedent to the exercise of that discretion that are stipulated in the clause”.

The relevant passage of D’Angelo on which His Honour relied is as follows:

“Mr Schofield, on behalf of the Council, has submitted that the building was constructed in part for residential purposes and in part for a commercial purpose and that it is only that part that was constructed for commercial purposes that can be considered under cl.15 of LEP 20. The Council records do not disclose for what

purpose the whole or any part of the building was originally constructed. It is clear, however, that it was not constructed exclusively for residential purpose. On the information before me, the most obvious inference is that it was constructed for the purpose of a shop and dwelling. The opening words of cl.15 do not use the words ‘or any part thereof’. To attract the operation of the clause, the building must have been constructed for a use other than residential. In my opinion, this building was constructed for a use other than residential. I see no legal warrant for reading a limitation into the opening words of cl.34. Nor, in my opinion, is there any town planning reason why the section should be read down. The interpretation I have adopted does not mean the Council must approve the whole of the building for a commercial purpose. As the concluding words of the clause make clear, it may consent to the use of the whole or any part for that purpose.”

In his final judgment in the Blance matter, His Honour allowed the appeal against the Council’s refusal of development consent to the extension of the restaurant use.

His Honour determined that the whole of the building could be used for the restaurant, subject to the imposition of suitable conditions, and subject to finding that the proposed development was legally permissible.

His Honour said at page 6 “Somewhat strangely this question remained in issue throughout the hearing despite my determination of the preliminary question of law … .”

Having decided that the amenity of the locality would not be adversely affected by approval of the application, one of the conditions precedent had been satisfied, so His Honour proceeded to consider whether the building was not suitable on physical or economic grounds for conversion to or replacement by a residential use.

He accepted the opinion that the first floor was physically capable of being used for residential purposes and it had been so used until 1993.

His Honour went on (at page 7):

“However, the condition precedent to cl.15 of the LEP is not physical capability, but is non-suitability on physical or economic grounds… Indeed, I find that it is the very success of the Applicant’s restaurant business (with its pressure to extend to the first floor e.g. to provide office space and staff amenities) that is a contributing physical and economic factor to the non-suitability of the self-contained residential use of the first floor”.

His Honour was accordingly satisfied that the subject premises (at least the first floor) were not suitable for conversion to residential use. He said, “It follows that the planning discretion conferred by cl.15 of the LEP is available in the present case, and for the reasons I have given, should be exercised in the manner I have proposed in favour of the Applicant”.

His Honour went on to make a few other relevant observations in respect of cl 15:

“(i) I am not persuaded that the correct application of the clause is to be found in concentrating consideration on the question of the conversion to residential use of the first floor (as was done in this case). In my judgment, the more appropriate application of the clause in respect of the condition precedent contained in paragraph (a) is to consider the whole of the subject building and not merely its first floor component. (This approach is consistent with the construction of cl.15 adopted in my earlier judgment). If the whole of the building is considered, then the requisite satisfaction (that the building is not suitable on physical or economic grounds for conversion to residential use) is attained overwhelmingly and far more emphatically than is the same satisfaction, if consideration be limited to the first floor of the subject premises.

(ii) If I had held that the planning discretion conferred that cl.15 of the LEP was not available in the present case (because of the non-fulfilment of either or both of the statutory conditions precedent) I would not have accepted the Council’s argument that notwithstanding this conclusion the existence of cl.15 operated on s.106 of the EP&A Act to deny the use of the existing restaurant, the status of ‘existing use’ as defined in s.106.

In a nutshell, the Council’s argument is that the existence of cl.15 of the LEP means that the LEP ‘does not have the effect of prohibiting’ (within the meaning of s.106 of the EP&A Act) the restaurant use. The fallacy of the argument lies in the fact that it fails to appreciate that the non-fulfilment of the statutory conditions precedent to the exercise of the planning discretion conferred by cl.15 of the LEP means that that power is simply not available to overcome the prohibiting effect of the LEP by virtue of the controls it imposes on land within the Residential 2(b2) zone (being the zoning of the subject premises) which controls, absolutely prohibit restaurant development.”

Consideration

In this case Council submits that for the proposed use (otherwise prohibited) of the building as an entirety to obtain the benefit of cl 15, the consent authority must be satisfied as to the matters in paragraphs (a) and (b) of cl 15. Hence, the submission continues, cl 15 can only apply to the building or part of the building constructed on the premises for use other than residential; it does not and cannot apply to the proposed erection of a structure which adds to the existing building, and so increases or intensifies the use by superimposing a structure which never formed part of the building. In Council’s submission you can only utilise/use the existing building and not add to it by way of additional structures.

Consistent with Blance , the whole of the building in this case must be assumed to have been constructed as a hotel. For many years following the establishment of the first hotels in this country, a residential component was integral to hotel buildings, particularly those that were in existence, and used as hotels, prior to 1957.

The western wall of the Merton Estate Hotel is part of the hotel building, and I have come to the view that the addition of an advertising structure to that part of the building is a legitimate “use” of the building within the meaning of cl 15.

Accordingly, I would answer the question in the affirmative.

The Question of Costs

Mr Thompson on behalf of the applicant submitted that as this matter was being litigated for effectively the third, if not the fifth time, the circumstances of the case were exceptional , and if I answered the question favourably to his client, I should make an order for costs.

He submitted that the case before the Court is squarely the same issue as that which was dealt with by Cripps and Bignold JJ in the cases to which I have referred.

Whilst those cases facilitated my decision-making in this matter, this hearing involved, fundamentally, a different question, as both the D’Angelo and Blance litigation concerned internal use of building, the external appearance of which was to remain basically unchanged.

In those circumstances, I do not find this case to be so unusual as to meet the tests applied in the authorities which have defined as “exceptional” the circumstances involved in the determination of preliminary questions of law. See, especially, Outdoor Australia Pty Ltd v Auburn Council (1996) 89 LGERA 365.

Accordingly, I decline to make an order for costs.

Orders

Accordingly, the orders of the Court will be:

1. Question answered in the affirmative.

2. No order as to costs.

3. The exhibits may be returned.

4. Matter returned to the Registrar for setting down for hearing on the merits, before an Assessor of the Court.

I HEREBY CERTIFY THAT THIS AND THE PRECEDING 14 PAGES ARE A TRUE AND ACCURATE RECORD OF THE REASONS FOR JUDGMENT HEREIN OF THE HONOURABLE JUSTICE T.W. SHEAHAN.