Alfredo Giusti v Kathleen Grant (24 April 1998)

[1998] NSWLEC 5

Land and Environment Court

of New South Wales

CITATION:	Alfredo Giusti v Kathleen Grant (24 April 1998) [1998] NSWLEC 5
PARTIES:	Applicants: Alfredo Giusti, Franca Maria Giusti, Walter Casanova, Maria Luisa Casanova, Rino Polzot, Anna Polzot, Pamela Mavis Bayfield, Sharon Therese Bayfield, Yvonne Bayfield Respondent: Kathleen Grant
FILE NUMBER(S):	40314 of 1997
CORAM:	Sheahan J
KEY ISSUES:	:-
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979 Land & Environment Court Act 1979 Greater Taree Local Environment Plan 1995 Supreme Court Act 1970
CASES CITED:	National Parks & Wildlife Service v Stables Perisher Pty Ltd (1990) 20 NSWLR 573 ; Whitehouse v Remme (1988) 64 LGRA 375; Coles Supermarkets (Australia) Pty Ltd & K-Mart v Minister for Urban Affairs and Planning and Wagga City Council (1996) 90 LGERA 341; Coshott v Ludwig (14 February 1997); Marjen Pty Ltd v Coles Myer Limited; Challister Limited v Blacktown City Council (1992) 76 LGRA 10; Donald Crone & Associates Pty Limited v the Council of the City of Bathurst (10152 of 1988; Challister Limited v Blacktown City Council (1992) 76 LGRA 10 ; Ludwig v Coshott (1994) 83 LGERA 22 ; Doe v Cogente Pty Limited (1997) 94 LGERA 305; of Doyle v Phillips (1997) NSW ConvR 55-822
DATES OF HEARING:	13 March 1998
DATE OF JUDGMENT:	04/24/1998
LEGAL REPRESENTATIVES:	John Bisley of Thomas & Bisley Mr Cleaves of Cleaves Mallik Gibbs

JUDGMENT:

JUDGMENT

Introduction & Background

The first six applicants in these proceedings are the registered proprietors of the property comprised in Lot D in Deposited Plan 101418 and known as No.19 William Street, Hallidays Point, New South Wales (“No. 19”).

The respondent is the registered proprietor of Lot 15 in Deposited Plan 358890 which is No.26 on the opposite side of William Street (“No.26”).

No.26 has the benefit of a registered covenant No.926266 (“the covenant”) which burdens the title of No.19.

The covenant was made in a transaction on 13 June 1980 involving none of the parties to these proceedings.

The effect of the covenant is, in essence, to limit the height of any building erected on No.19 to a level 0.25 metres below the ground level of the two-storey part of the brick house erected on No.26, but the covenant “may be released, varied or modified by the registered proprietor for the time being of” No. 26.

Exhibit A2 is a large coloured photograph of the vacant block No.19 apparently taken from No.26, from which it is apparent that a “tall” building on No.19 would preclude access by No.26 to a quite stunning seaside view.

It is common ground that cl 8(1) of The Greater Taree Local Environmental Plan 1995 (“the LEP”) relevantly provides that if any covenant prohibits a use permitted by the plan, the covenant shall not apply to that use to the extent necessary to permit that use.

It is also common ground that No.19 is zoned residential 2(a), in which zone dwellings are permissible without consent.

The Bayfield family intends to erect a two-storey building on No.19, which is currently vacant land, and on 22 September 1997 the Greater Taree City Council issued a building approval for such a dwelling to “M Bayfield”.

The respondent admits that the covenant does not prevent the erection of a two-storey dwelling on the subject land, but alleges that any two-storey dwelling erected in accordance with that particular building approval will be in breach of the covenant, and she has threatened to commence proceedings in the Supreme Court of NSW to enforce it.

The Proceedings

In these proceedings the applicants seek:

1. A declaration that on the proper construction of cl 8(1) of the LEP the covenant does not apply to the erection of a two-storey building at No.19 in, or substantially in, accordance with the building approval.

2. Alternatively, the applicants seek a declaration that on its proper construction the said covenant does not restrict, prohibit or prevent the erection or use of such a dwelling on the land at No.19.

3. An order restraining the respondent from commencing proceedings to enforce, or for breach of, the said covenant, by reason of the erection, or proposed erection, of the said dwellings on the subject land.

Although some of the points of claim are not admitted on the face of the pleadings, the Court has the benefit of an agreed bundle of documents ( Exhibit A1 ) which include:

· the LEP

· the covenant

· title searches in respect of the two blocks of land

· the cover page of a contract of sale between the first six applicants and the Bayfields

· the building approval B580/97 in respect of lot D addressed to Mr M Bayfield, and

· a s 149 certificate confirming the zoning of the land as residential 2(a).

Jurisdiction

The respondent submits that this application lies outside the jurisdiction of the Court.

She relies upon s 16 of the Land & Environment Court Act 1979 (the “LECA”) which provides that the Court shall have the jurisdiction vested in it by legislation, plus jurisdiction to hear and dispose of any matter not falling within its jurisdiction but “ancillary to a matter that falls within its jurisdiction”.

Class 4 jurisdiction is defined in s 20 by reference to a large number of statutory provisions set out in sub-section (1).

Section 20(2) provides:

“The Court has the same civil jurisdiction as the Supreme Court would, but for section 71, have to hear and dispose of proceedings:

(a) to enforce any right, obligation or duty conferred or imposed by a planning or environmental law or a development contract;

(b) to review, or command, the exercise of a function conferred or imposed by a planning or environmental law or a development contract;

(c) to make declarations of right in relation to any such right, obligation or duty or the exercise of any such function; and

(d) whether or not as provided by section 68 of the Supreme Court Act 1970 - to award damages for a breach of a development contract.”

Section 20(3) defines “a planning or environmental law” for the purposes of sub-section (2) in terms of a large number of Acts and “any statutory instrument made or having effect thereunder or made for the purposes thereof, including any deemed environmental planning instrument within the meaning of the Environmental Planning and Assessment Act 1979” (“EPAA”) as respectively in force at any time before, on, or after 1 September 1980.

A “development contract” is defined in s 20(5), but it is common ground that there is no development contract in this matter.

The respondent contends that to give s 16(1) its maximum width, the proceedings before the Court must contain at least one element in respect of which jurisdiction may be found elsewhere. She contends that the only possible source of jurisdiction in these proceedings must be found in s 20(2)(a) or (c) quoted above, for the purpose of which, the applicants must show that they have a right of the kind contemplated by the section, which envisages a right against a consent authority.

The respondent contends that a building approval does not confer such a right , but merely gives a liberty to build. It is not enforceable against any other landowner. If it conveys a right, it is only against the consent authority, which is not a party to these proceedings, and against which no relief is sought.

She contends that s 16 would assist the applicants only if they had grounds for substantive relief within the jurisdiction of the Court. In particular, the respondent contends that the Court does not have power to make the orders sought in par 3 of the application because such an order could not be ancillary to any matter falling within the jurisdiction of the Court under any other provision.

The respondent relies upon National Parks & Wildlife Service v Stables Perisher Pty Ltd (1990) 20 NSWLR 573 (“ Stables Perisher ”), in which Bignold J had held that this Court had jurisdiction to entertain a claim in tort for general damages, and the Court of Appeal held that this Court’s jurisdiction was limited , and that, unlike the Federal Court of Australia, it has no “pendent” or accrued jurisdiction.

The proceedings in Stables Perisher were Class 4 proceedings, and Gleeson CJ dealt with s 20 in some detail. He said at 581:

“An inherent or implied power in a Court to do all that is necessary to enable it to act effectively within its jurisdiction is very different from an implied power in a Court of limited jurisdiction to resolve the entire subject matter of a controversy part of which falls within the express jurisdiction of the court. The Australian cases have never recognised a general implied power of the latter kind”.

In respect of s 20(2) Gleeson C J said at 582:

“It is undoubtedly true that claims for relief of the kind described in [it] will sometimes form only part of a wider controversy between the parties. The Land & Environment Court, of course, in resolving a claim that is properly brought within its jurisdiction, has the power and the duty to decide all questions of fact or law that need to be decided in order to deal with that claim. Such questions might be questions of such a nature that they could also very well have arisen for decision in another forum. There is nothing unusual about that. There are many Tribunals of limited statutory jurisdiction which, in exercising that jurisdiction, may find themselves called upon to resolve issues of fact or law that could also have arisen, in another way, elsewhere. However, where it is s 20(2) that is the basis of the application to the Court, then the available powers to grant relief are to be found in the terms of the sub-section, read together with s 22. In this connection s 22 is not to be understood as extending the jurisdiction of the Court, but as conferring on it full power to exercise a jurisdiction that is granted elsewhere. There may be cases in which a question will arise as to where to draw the line between a proper exercise of the power conferred by s 22 and an impermissible excursion beyond jurisdiction.”

Section 58 of the LECA provides for appeals to the Supreme Court against decisions made in Class 4 and s 71 provides: “Subject to section 58, proceedings of the kind referred to in section 20 (1)(e) may not be commenced or entertained in the Supreme Court”.

In Stables Perisher , Gleeson CJ said at 583:

“It by no means follows from the fact that the Land & Environment Court has by reason of s 71 of the Act, an exclusive jurisdiction to make a declaration of right as to the validity of such a consent that the Supreme Court cannot deal with an argument concerning the question of the validity of the consents where that argument arises in the course of litigation in this Court … However, if the respondent still desires to litigate this issue in the Land and Environment Court I do not see why it should be stopped from doing so. After all, the issue originally arose in proceedings commenced by the ski club against the appellants and the respondents, and the issue having been properly committed to the jurisdiction of the Land and Environment Court, a desire on the part of the respondent to pursue it to a conclusion in that court is not unreasonable. It also has the practical advantage that the court is a specialist court, and there might well be issues relevant to the operation of [sections of the Environmental Planning & Assessment Act 1979] that are more appropriately dealt with in that court than elsewhere.”

At 585, Kirby P said:

“The Land & Environment Court is a superior court of record. But it is a statutory court of limited jurisdiction. It is therefore inevitable that, in marking out the limits of its jurisdiction a point will be reached where jurisdiction ends. When that happens, that court must refrain from purporting to exercise jurisdiction. It must do so however inconvenient it might be to the litigants, frustrating to the members of that court seeking to do justice in the case and even seemingly irrational in the efficient deployment of scarce public resources for the resolution of disputes by litigation. If the court purports to exercise a jurisdiction which it does not in law have, it is the duty of this Court, upon application, upholding the rule of law, to invalidate any assertion of jurisdiction which does not lawfully exist.”

He went on (at 585-6) to hold that Bignold J, and Stein J in Whitehouse v Remme (1988) 64 LGRA 375, had “overstepped the mark” in circumstances with which Kirby P had some sympathy.

“The jurisdiction of a court or tribunal of limited authority cannot be conferred by concession. In the case of a court created by statute, it must be found, expressly stated or implied in the language of the statute.

Such language should not receive a narrow construction. The establishment of a superior court of record will be taken to carry with it all the powers which are necessary to enable that court to act effectively within the jurisdiction conferred… The very fact that the Land and Environment Court is such a superior court of record will import the implication that, within its defined jurisdiction, amply construed, it will be entitled to do the large range of things that superior courts of record traditionally do. This approach to the elaboration of its powers is appropriate because the alternative is that the Land and Environment Court may resolve part only of a dispute. For the resolution of the rest of the dispute, the parties will then be required to proceed to another court if they have the will, the funds and the patience to do so. Inevitably, that will involve cost, delay, inconvenience and even the risk of inconsistent findings”.

There is no intrinsic difficulty with similar issues being litigated in two separate Courts at the same time.

Such a situation occurred in the Marjen litigation regarding “Sturt Mall” in Wagga Wagga (see matter No.40019 of 1993, unreported, 3 May 1993, and then 90 LGERA at 341 and 363).

I observe in passing that Wagga Wagga City Council was not a party to the Marjen matter in 1993, and no issue of jurisdiction appears to have been taken.

In fact, the Marjen litigation came before this Court on at least two occasions.

In 1993 the Chief Judge (Pearlman J) considered the effect of covenants in leases of Marjen’s land, upon which the Sturt Mall Shopping Centre was erected.

Section 28 of the EPAA provides:

“(1) In this section, regulatory instrument means any Act (other than this Act), rule, regulation, by-law, ordinance, proclamation, agreement, covenant or instrument by or under whatever authority made.

(2) For the purpose of enabling development to be carried out in accordance with an environmental planning instrument or in accordance with a consent granted under this Act, an environmental planning instrument may provide that, to the extent necessary to serve that purpose, a regulatory instrument specified in that environmental planning instrument shall not apply to any such development or shall apply subject to the modifications specified in that environmental planning instrument.

(3) A provision referred to in subsection (2) shall have effect according to its tenor, but only if the Governor has, before the making of the environmental planning instrument, approved of the provision.

(4) Where a Minister is responsible for the administration of a regulatory instrument referred to in subsection (2), the approval of the Governor for the purposes of subsection (3) shall not be recommended except with the prior concurrence in writing of that Minister.

(5) A declaration in the environmental planning instrument as to the approval of the Governor as referred to in subsection (3) or the concurrence of a Minister as referred to in subsection (4) shall be prima facie evidence of the approval or concurrence.”

The Chief Judge was not persuaded in Marjen that there was anything in the opening words of s 28(2) to require the interpretation that one limb of those opening words refers to a circumstance where development is permissible without consent, and the second limb to a circumstance where development is permissible only with consent. Such dichotomies appear elsewhere in the Act, but are expressly stated.

The Chief Judge went on to point out that the wide ambit of s 28 may be constrained by the environmental planning instrument itself, because s 28 refers to a requirement that such regulatory instruments should be specified in the environmental planning instrument.

The Sturt Mall came back before the Court in a matter reported in the LGRA Reports as Coles Supermarkets (Australia) Pty Ltd & K-Mart v Minister for Urban Affairs and Planning and Wagga City Council (1996) 90 LGERA 341, but referred to in Court of Appeal judgment in Coshott v Ludwig (14 February 1997) as Marjen Pty Ltd v Coles Myer Limited .

The Chief Judge in her judgment in the second matter refers to her judgment of 3 May 1993 and to the fact that subsequently, on 7 May 1993, Windeyer J in the Supreme Court, granted an injunction restraining Marjen from undertaking the development.

In 90 LGERA at 363 Pearlman J held that cl 23A of the Wagga LEP was effective to negative the necessity for consent referred to in the relevant clause of the leases. In doing so, she

applied the principles in Challister Limited v Blacktown City Council (1992) 76 LGRA 10, where Talbot J asserted that the purpose of s 28 is “to overcome any impediment placed on development which is to be carried out in accordance with Part IV of the EPAA”.

The issue in this case is the impact and effect of EPAA s 28 upon the circumstances of this case, and, in particular, the covenants.

There can be no question that the EPAA is a “planning or environmental law”, nor that the “right” involved in this matter is, or may include, a right to ignore the impact of the covenant.

I therefore reject the submission of the respondent that the Court does not have jurisdiction to deal with the subject matter, and I must now proceed to a consideration of the issues involved in the prayers for relief.

Given the circumstances in Marjen , I do not believe it would be appropriate in the exercise of the Court’s jurisdiction in a case such as this to make the order sought in prayer 3 of the Class 4 application, namely an order restraining the respondent from commencing proceedings elsewhere. It may be that in the fullness of time some issue of estoppel or res judicata might arise in any such proceedings, but this Court should be very reluctant and hesitant to exclude any citizen’s assertion of rights in other appropriate jurisdictions.

Accordingly I turn my attention to the declaratory relief sought.

The Planning Regime

The Greater Taree Local Environment Plan 1995 commenced on 11 August 1995, having been signed by the Minister on 30 July 1995.

It may therefore be regarded, as Mr Robertson submitted on behalf of the applicants, as a very modern objective-focused planning instrument.

Clause 8 of the LEP provides:

“1. If any agreement, covenant or instrument prohibits a use permitted by this plan, then it shall not apply to that use (to the extent necessary to permit that use).

2. Before this plan was made, the Governor approved of subclause (1) under section 28 of the Act.”

The aims of the LEP are set out in clause 9 which provides relevantly as follows:

“This plan generally aims to:

(a) uphold and promote the objects of the Act;

(b) identify zones as referred to in clause 10 and achieve the objectives for each zone;

(d) provide flexibility in the development potential of the City by ensuring a wide range of land use options, while minimising conflict between incompatible land uses.”

Clause 10 provides for the zones and for their respective objectives.

Clause 17 provides for zone 2(a) residential and states the following objectives for such zones:

“(a) the preservation of the residential amenity;

(b) the regulation of the subdivision and use of land for housing, with ancillary development permitted only where the scale, type and traffic generating characteristics of the ancillary development are compatible with the character and amenity of the area;

(c) the encouragement of a range of residential development providing for flexibility and variety of housing types and designs, densities and associated land uses, with conservation of visual amenity; and

(d) the promotion of development considered by the Council to be a desirable land use within the urban living area, which is compatible with the residential environment”.

In zone 2(a) dwellings are permissible without consent. All development which is not consistent with the objectives of the zone relevant to the particular case, is prohibited, except as otherwise provided in the table. Consent can be obtained for “any development other than development which is permissible without consent or which is prohibited”.

Section 76 of the EPAA provides as follows:

“(1) Subject to this Act, where an environmental planning instrument provides that development specified therein may be carried out without the necessity for consent under this Act being obtained therefor, a person shall not carry out that development on land to which that provision applies except in accordance with the provisions of that instrument.

(2) Subject to this Act, where an environmental planning instrument provides that development specified therein may not be carried out except with consent under this Act being obtained therefor, a person shall not carry out that development on land to which that provision applies unless:

(a) that consent has been obtained and is in force under this Act, and

(b) the development is carried out in accordance with the provisions of any conditions subject to which that consent was granted and of that instrument.

(3) Subject to this Act, where an environmental planning instrument provides that development specified therein is prohibited, a person shall not carry out that development on land to which that provision applies”.

Section 25 of the EPAA provides as follows:

“(1) An environmental planning instrument shall state the aims, objectives, policies and strategies whereby that environmental planning instrument is designed to achieve any of the objects of this Act.

(2) Except as provided by subsection (3), a statement referred to in subsection (1) does not affect the construction or effect of any other provision of the environmental planning instrument in which the statement is made.

(3) Where a provision of an environmental planning instrument is genuinely capable of different interpretations, that interpretation which best meets the aims, objectives, policies and strategies stated in that instrument shall be preferred.

(4) A failure to comply in any respect with subsection (1) does not affect the validity, construction or effect of an environmental planning instrument.

(5) This section does not apply in the case of a deemed environmental planning instrument.”

The outcome of the application of all these provisions in both the EPAA and the LEP is that in respect of zone 2(a) land any proposal to construct a dwelling house will be determined on its merits according to the public interest and principles of planning at the building application stage and should not be affected by contrary private arrangements such as are found in the covenant.

Consideration

In Donald Crone & Associates Pty Limited v the Council of the City of Bathurst (10152 of 1988, Cripps J, 19 October 1988, unreported) Cripps J rejected a submission that the terms of s 28 do not authorise the inclusion in a local government plan of a provision that a regulatory instrument not apply to a development.

His Honour advanced two reasons for his rejection of this submission.

“First, because the context of s 28(2) itself makes clear the intended meaning of the word ‘specified’. Section 28(2), in terms, was enacted ‘for the purpose of enabling development to be carried out in accordance with an environmental planning instrument’. In these circumstances, it is unhelpful, in my opinion, to speak of a presumption against invading proprietary rights. Furthermore, if the interpretation contended for … is accepted, it would mean that not only would the Council be obliged to search every title before submitting a planning instrument to be made, but it would have no way of knowing what private treaties had been entered into. Moreover, even if there were means of discerning relevant regulatory instruments, the local environmental planning instrument would have to be amended every time a private treaty or arrangement was made which conflicted with the plan”.

His Honour concluded:

“In my opinion, the section requires that the planning instrument specify which, if any, regulatory instrument is not to apply to development. The section does not require that a particular regulatory instrument be identified by a number or any other identifying means”.

In Challister Limited v Blacktown City Council (1992) 76 LGRA 10 Talbot J dealt with a provision in the Blacktown LEP which precluded the operation of “any covenant, agreement or instrument imposing restrictions on development …” and said at 23:

“The purpose of s 28 is to overcome any impediment placed on development which is to be carried out in accordance with Pt IV of the Environmental Planning and Assessment Act . It recognises that the ultimate regulatory provisions in relation to the carrying out of development resides in Pt IV of the Act. If those provisions are complied with either without consent but pursuant to an environmental planning instrument or in accordance with a development consent then the regime of the Environmental Planning and Assessment Act may prevail over any other act or any rule, regulation, by-law, ordinance, proclamation, agreement, covenant or instrument by or under whatever authority made if it is so provided in an environmental planning instrument with the approval of the Governor.

Section 28 was enacted for the purpose of enabling development to be carried out. To that end an environmental planning instrument may include the type of provision of which cl 26 is an example. In order to serve the purpose of enabling development to be carried out in a regulatory instrument such as a restriction or covenant shall not apply to development which is carried out in accordance with an environmental planning instrument or in accordance with a consent granted under the Environmental Planning and Assessment Act.

Section 28(2) removes any bar to the development being carried out. It has no effect on whether development consent should be granted. The terms of the restrictive covenant are not a bar to the grant of a development consent. If a development consent is granted to permit a use which is in conflict with the terms of the restrictive covenant it does not follow that the development consent will be invalid. Neither does it follow that the developer must make application to the Supreme Court to have the covenant released varied or modified if the person having the power to release vary of modify the covenant refuses to co-operate. A close examination of s 28(2) shows that it is this last step of releasing varying or modifying the covenant to which the subsection is directed.

The opportunity to make such a provision in an environmental planning instrument is intended to achieve a result whereby development which satisfies the criteria laid down

by the planning legislation may proceed notwithstanding any constraint imposed by other regulatory instruments. The Parliament recognised the significance of the extent of this power by subjecting its exercise to the approval of the Governor and in some cases to the concurrences of the relevant Minister”.

Bryson J in the Equity Division of the Supreme Court in Ludwig v Coshott (1994) 83 LGERA 22 held that s 28 resulted in a development consent prevailing over a restrictive covenant. He applied Crone, Challister , and Marjen .

When his judgment was upheld by the Court of Appeal on 14 February 1997, Meagher JA, delivering the primary judgment of the Court, endorsed the authority of that line of cases and Bryson J’s conclusion on them, saying:

“Restrictive covenants are an established feature of conveyancing practice, and are usually made between private parties. There is no need to restrict its meaning if its meaning is clear. Rules, regulations, by-laws, ordinances and proclamations comprise one genus, viz. Documents issued by public authorities; but agreements, covenants and instruments are manifestly not within the same genus. If one departs from a literal interpretation and approaches the matter from a purposive interpretation, the same result emerges, but more clearly. The self-evident purpose of s.28 of the Act and clause 32 of LEP27 is to nullify and remove all obstacles to the planning principles decided on by the Council or the Minister. In this context s.28 of the Act is stating, in effect, ‘an environmental planning instrument may state what documents should be disregarded’, and clause 32 of LEP27 is stating that one type of document to be disregarded is a document creating a restrictive covenant. As to the argument about the words ‘by or under whatever authority made’, I am of the view that, although chosen without conspicuous felicity, they mean no more than ‘howsoever created’.”

“Like all words, the word ‘specify’ must take its colour from the context in which it appears. In the legislation considered by the House of Lords, the conjunction of the word ‘specify’ with the word ‘particulars’ obviously led to giving the word ‘specify’ a very narrow construction. In the context of s.28 of the Act under consideration here, however, there is no good reason to interpret the word as meaning more than ‘indicate’, ‘state’, ‘mention’. The onerous nature of the tasks involved, if it were given a more narrow meaning, is itself, I should have thought, sufficient reason for not confining it.”

Late last year, in Doe v Cogente Pty Limited (1997) 94 LGERA 305, Cowdroy AJ applied the Court of Appeal decision in Coshott , and said at 317:

“To date it appears that there is no decision dealing with the application of s 28 to an easement. Since rights of way and restrictive covenants have their source in an

agreement, covenant or instrument, there is no reason why s 28 should not apply to a restriction on land, namely a right of way.

Even though its application may appear to constitute an invasion of traditional conveyancing and land law principles, s 28 can, in order to enable a development to proceed, interfere with proprietary rights. Whilst such interference is limited ‘to the extent necessary to serve that purpose’, if such purpose resulted in the extinguishment or permanent stay of such rights, that is a natural consequence of the interpretation of s 28 (2) of the EPA Act.”

His Honour then quoted some of the above passage of Talbot J’s judgment in Challister and some of the above-quoted reasoning of the Court of Appeal.

His Honour then said:

“Thus the powerful effect of s 28 is starkly revealed. It means that any restriction which might stand in the way of a development, even if created for the benefit of adjoining owners or other persons having an interest in the development site, may be suspended or neutralised to the extent necessary to permit a development pursuant to provisions of Pt 4 of the Act. This results directly from the interpretation of s 28, the true potential effect of which is now clearly demonstrated.”

Cowdroy AJ’s decision was upheld by the Court of Appeal in a judgment delivered 16 March 1998 (see also 72 ALJ 181).

The case of Doyle v Phillips (1997) NSW ConvR 55-822 was relied upon by the respondent, but a careful reading of that case does not invalidate the above line of authority. In fact, the judgment of Young J indicated precisely what Pearlman J had said in Marjen , namely that the planning instrument involved must be closely scrutinised to ensure that the regulatory instrument in issue is actually affected by it.

In Doyle v Phillips the relevant clause of the planning ordinance dealt quite specifically only with erection of buildings for dual occupancy. Extinguishment of the covenant was necessary only where it was needed to serve the purpose of the plan, i.e. the purpose of allowing dual occupancy.

The respondent also relied upon a judgment of McLelland, CJ in Equity, in Application of Thompson , (Unreported, Monday 25 October 1993), in which a restrictive covenant had to be considered in the context of SEPP 25, cl 19 of which suspended the application of covenants, etc. to the extent necessary to serve the purpose of enabling the subdivision of dual occupancy development to be carried out.

His Honour said:

“The main question is whether the covenant imposes restrictions as to the erection or use of more than one dwelling house or dwelling on lot 73. In my opinion, for the purposes of clause 19, a covenant cannot be said to ‘impose’ a restriction of the described kind, unless such a restriction is expressly stated or necessarily implied in the covenant. It is not sufficient to attract the operation of clause 19 that in its application to a particular physical situation, or in combination with other requirements of the law, the incidental operation of the covenant would be to inhibit or prevent the erection of more than one dwelling house on a particular allotment. Since the effect of clause 19 is to derogate from vested proprietary interests (of which the benefit of a restrictive covenant is one form) it should not be construed in such a manner as to extend its operation in that regard further than its words clearly require, in accordance with well established principles relating to the construction of legislation and legislative instruments. It is sufficient to cite the following authoritative statement:

‘The Courts are not entitled, and ought not, to eke out a derogation of … private rights by implications not rendered necessary by the words used by Parliament but merely considered to be consistent with the policy which the Courts conclude or suppose the Parliament to have intended to implement.’ ( Wade v NSW Rutile Mining Co 121 CLR 177 at 181 per Barwick CJ).

In the present case, the covenant does not expressly or by necessary implication proclude the erection of more than one main building on lot 73 and accordingly, the plaintiff’s second claim also fails”

Here again the judgment relied upon by the respondent adds weight to the authoritative pronouncement by Pearlman J that one must be quite specific and careful when interfering with private rights and treaties.

Conclusions

In the end analysis, the current state of the law is that provisions in LEPs, which nullify covenants, must and will be construed carefully, but without regard to any presumption in favour of private rights.

The LEP in this case seems to me to seek to maximise flexibility in the height of buildings, and to remove bureaucratic controls on residential development of land identified by zoning as suitable for the purpose.

It is inconsistent with the purpose of the zone to uphold a prohibition on a particular kind of dwelling, which might be imposed by a private agreement. As Mr Robertson put it “a planning provision which contemplates that a two-storey dwelling is permissible without consent must be inconsistent with a private covenant prohibiting the erection of such a dwelling” (par 7 of written submissions).

The particular aspects of a building proposal such as its design, height, type, etc. are matters of technical detail to be assessed on their merits at the building approval stage, given that no development consent is required.

I accept that there is utility in the circumstances of this case in the Court making the declaration sought in Prayer 1 of the Class 4 application, namely, that on the proper construction of cl 8(1) of the LEP the covenant does not apply to the erection of a two-storey building at No.19 in, or substantially in, accordance with the building approval.

As indicated above, in the Court’s discretion I decline to make the order restraining the respondent from commencing proceedings elsewhere to enforce, or in respect of the breach of, the covenant.

The respondent should pay the costs of the applicants.

Orders

1. The Court declares that on the proper construction of cl 8(1) of the Greater Taree Local Environment Plan 1995, covenant No.R926266 does not apply to the erection of a two-storey dwelling on lot D DP101418 known as No.19 William Street, Hallidays Point in, or substantially in, accordance with building approval B580/97 granted by Greater Taree City Council on 22 September 1997.

2. The respondent will pay the costs of the applicants.

3. The exhibits may be returned.

I HEREBY CERTIFY THAT THIS AND THE PRECEDING 17 PAGES ARE A TRUE AND ACCURATE RECORD OF THE REASONS FOR JUDGMENT HEREIN OF THE HONOURABLE JUSTICE T.W. SHEAHAN.

Associate: