Allen v Cairns Regional Council
[2015] QPEC 28
•3 July 2015
PLANNING & ENVIRONMENT COURT
OF QUEENSLAND
CITATION:
Allen & Anor v Cairns Regional Council & Anor [2015] QPEC 28
PARTIES:
BARRY GORDON ALLEN and EDGEWILL PTY LTD ACN 054 606 549
(Applicant)v
CAIRNS REGIONAL COUNCIL
(First Respondent)and
ROSANN BARNES and DARRYL BARNES
(Second Respondent)
FILE NO/S:
OA No 97 of 2014
DIVISION:
Planning and Environment
PROCEEDING:
Originating Application
ORIGINATING COURT:
Cairns
DELIVERED ON:
3 July 2015
DELIVERED AT:
Brisbane
HEARING DATE:
8, 9 and 10 October 2014
JUDGE:
Andrews SC DCJ
ORDER:
Declare that the existing use of lot 6 on RP 744005 located at 29-31 Zanzoo Close, Crystal Cascades, Redlynch for a wholesale nursery is a lawful use pursuant to section 681 of the Sustainable Planning Act 2009 and does not require a development approval
Declare that the development application lodged by Edgewill Pty Ltd on about 13 August 2013 was not required
In respect of costs liberty to each party to apply by giving notice of the order sought to the other parties and to my associate by 4.00 pm on 10 July 2015 and by supplying any submissions on costs in writing to the other parties and to my associate by 4.00 pm on 17 July 2015 and by supplying any submissions in reply in writing to the other parties and to my associate by 4.00 pm on 24 July 2015.
CATCHWORDS:
PLANNING AND ENVIRONMENT – whether a wholesale nursery use was an existing use on 29 November 1996 – whether the use was then lawful ‘Agriculture’ or unlawful ‘Rural Industry’ – whether the use was abandoned – whether there was a material change of use by intensification since 30 March 1998 – whether a shade house used for the wholesale nursery was unlawful – whether use of an unlawful shade house was a public policy basis to refuse declarations
COUNSEL:
Fantin for the Applicant
Morzone QC for the Second Respondent
SOLICITORS:
Williams Graham Carman Lawyers for the Applicant
P&E Law for the First Respondent
Murray & Lyons Solicitors for the Second Respondent
Issues
The corporate applicant (‘Edgewill’) operates a wholesale nursery outside Cairns. This dispute is about whether the current wholesale nursery use is lawful without a development approval. Unless the land was being lawfully used for a wholesale nursery before 29 November 1996 the use would be unlawful now (without development approval).
The first issue is whether the current wholesale nursery use began before 29 November 1996. If it commenced after that date the various planning schemes would have prohibited its commencement and it would now be unlawful without development approval. If it began before that date (It did.), the second issue arises and is whether the use then was either lawful ‘Agriculture’ or unlawful ‘Rural Industry’ as those terms were then defined in the planning scheme. If it was lawful ‘Agriculture’ (It was.) the remaining issues arise. Thirdly, was the use later temporarily abandoned? If so, it lost its lawful status. (It was not abandoned.) Fourthly, was the use so intensified over the years since 30 March 1998[1] that it materially changed? If so, it lost its lawful status. (It did not.) Fifthly, are the applicants precluded from obtaining a declaration as a matter of public policy because their use of the premises has included activity in a shade house which may not have building approval? (They are not precluded.)
[1]The date from which the notion of a ‘material change of use’ was introduced by the Integrated Planning Act 1997 (‘IPA’)
Nature of the proceeding
This proceeding is for declarations about the lawfulness of the current use.
Edgewill and Mr Barnes apply, pursuant to the Sustainable Planning Act 2009[2] (‘SPA’) for:
- A declaration that the use of lot 6 on RP 744005 located at 29-31 Zanzoo Close, Crystal Cascades, Redlynch (‘the land’) for a wholesale nursery is an existing lawful use pursuant to section 681 of SPA that does not require a development approval;
- A declaration that the development application lodged by Edgewill Pty Ltd on about 13 August 2013 was not required;
- An order that the Barnes pay Edgewill’s costs of and incidental to the proceeding as agreed or assessed; and
- Such further or other order as the Court deems appropriate.
The issues in this proceeding differ from the issues involved with Edgewill’s development application
[2]SPA sections 456(1)(e) and (7)
On 23 May 2013, following a complaint, Council issued a Show Cause Notice to Edgewill which relevantly:
1. Stated that Council could not find a record of an approval for the use of the land as a nursery and that therefore Council suspected the use was unlawful;
2. Asked Edgewill to show cause why an enforcement notice should not be issued requiring:
(a) The use to cease; or
(b) Steps be taken to secure an approval for the use.
On 22 July 2013 Edgewill made an application for a development permit for the use. The development application was assessed and Council issued a Negotiated Decision Notice on 13 February 2014 approving the development application subject to conditions. On 7 March 2014 the Barnes appealed against Council’s decision. That appeal is Planning and Environment Court appeal no. 30 of 2014. On 25 March 2014 Council’s solicitor advised the parties that Council had formed the view that the development application was not required because Edgewill had the benefit of existing lawful use rights.
If Edgewill fails to obtain the declarations, it has the benefit of the Negotiated Decision Notice subject to conditions and the Barnes would be at liberty to continue their appeal. The issues upon which the appeal would depend are different from the issues upon which this application depends.
There was evidence of chemical spraying on the land. There was evidence of ill health suffered by persons and a pet on Mrs Barnes’ land. The Barnes are naturally and rationally suspicious that drift from the spraying is the cause of the health problems. While a significant matter for the Barnes, the legal significance of those alleged health impacts is limited for this proceeding. The recollections of the alleged impacts are circumstantial evidence relating to the issue of whether the use has so intensified as to have materially changed from the use as it was on 30 March 1998. The alleged health impacts are not otherwise relevant to the outcome of this proceeding and the Barnes were not obliged to prove that the spraying has caused ill health and the applicants were not obliged to prove that it has not. The connection between the spraying and ill health, while possibly the most significant matter for the Barnes, is not an issue in this proceeding. It is an issue in in the appeal.
Council supports the application for declarations. Edgewill submits, without reference to authority, that this is significant because the elected local authority represents the public interest in upholding and enforcing planning law. I reject the proposition that the Council’s support has significance in this proceeding. In a proceeding for declarations about lawfulness of a use, the lawfulness or otherwise of the use at its commencement date and since will depend upon the commencement date, how the use was characterised according to the relevant planning scheme at the commencement date, whether according to that characterisation it was lawful at the commencement date and whether the use has since been abandoned or materially changed. The lawfulness or otherwise of the use is not affected by Council’s support for the application.
Uncontentious matters
The following facts are uncontentious.
Mr Allen is the owner and an occupant of lot 6 on RP 744005 located at 29-31 Zanzoo Close, Crystal Cascades, Redlynch (‘the land’) and the sole director and shareholder of Edgewill Pty Ltd. Edgewill carries on the business of a wholesale nursery on the land. Council is the local government for the land and the first respondent in this proceeding. Rosann Barnes and Darryl Barnes are the occupants of lot 7 on RP 744005 located at 33-35 Zanzoo Close, which is owned by Rosann Barnes and adjoins the eastern boundary of the land. They are the second respondents in this proceeding. The land has an area of 8,089m2. It is currently improved by a house, some sheds and shade houses.
In 1987 Mr Allen acquired the land. The planning scheme in effect for the land that year and until 29 November 1996 was the Town Planning Scheme for the Balance of the Shire of Mulgrave gazetted on 22 July 1978 (‘the 1978 scheme’) under the Local Government Act 1936 (‘LGA’). Under the 1978 scheme the land was zoned Rural Residential A, having been rezoned from Rural C on about 18 December 1986. In the Rural Residential A zone ‘Agriculture’ would have been a lawful use for the land without the consent of council.
Pursuant to the 1978 Scheme, there was no use called ‘wholesale nursery’. The parties accept that if the applicants are to succeed, they must establish as their first premise that the use of the land immediately before 29 November 1996 was ‘Agriculture’ and was not ‘Rural Industry’ within the meaning of those terms in the 1978 scheme. The words of the 1978 scheme, so far as they are relevant to this issue follow (and the highlighting has been inserted to reflect the emphasis used by Queen’s Counsel in his submissions for the Barnes):
‘Agriculture’ was defined as:
Any land, building or other structure used or intended for use for the growing of crops, fruit, vegetables and the like; The term includes the clearing of land and the cutting of native timber of a commercial basis: The term does not include domestic horticulture or any extractive industry carried on in connection with agriculture;
‘Rural Industry’ was defined as:
Any industry (not being a noxious or hazardous industry) handling, treating, processing or packing primary products;
‘Use’ was defined as:
In relation to land, includes the carrying out of excavating work in or under land and the placing on land of any material or thing which is not a building or other structure: The term includes any use which is incidental to and necessarily associated with the lawful use of the land in question;
‘Industry’, so far as is relevant for understanding the Barnes’ submission, was defined as:“Industry” – Includes –
(a) Any of the following operations:-(i)Any manufacturing process whether or not such process results in the production of a finalised article;
(ii)The breaking up or dismantling of any goods or, any article for trade, sale or gain, or ancillary to any business; ….
(v) Any operation connected with the installation of equipment and services and the extermination of pests but not including on-site work on buildings or other structures on land;…
(b)When carried on on land upon which any of the above operations are carried on –
(i) The storage of goods used in connection with or resulting from any of the above operations;
(ii) The provision of amenities for persons engaged in such operations;
(iii) The sale of goods resulting from such operations;
(iv)Any work or administration or accounting in connection with such operations; and
(c)Without limiting the generality of the foregoing, any industry or any class of industry particularly described or defined in this town-planning scheme, but does not include a domestic industry;
On 15 April 1991 the Local Government (Planning and Environment) Act 1990 (‘LGPEA’) commenced.
On 29 November 1996 the Planning Scheme for the Balance of the City of Cairns was gazetted (‘the 1996 scheme’). It replaced the 1978 scheme. As a consequence, the opportunity ended to commence on the land, as of right, a use falling within the definition of ‘Agriculture’ under the 1978 scheme. ‘Wholesale Nursery’ under the 1996 scheme and subsequent schemes has not been a use one could commence on the land as of right.
On 30 March 1998, parts of the Integrated Planning Act 1997 (‘IPA’) dealing with a material change of us came into effect.
On 1 March 2005 CairnsPlan 2005 (‘CairnsPlan 2005’) came into effect.
On 1 March 2009 CairnsPlan 2009 (‘CairnsPlan 2009’) came into effect.
On 18 December 2009 the SPA commenced.
In 2013 Council issued a show cause notice to Edgewill advising that the use was not a lawful use and required a development approval. In response to that show cause notice, in about August 2013 Edgewill lodged a development application for a material change of use for Primary Industry (Wholesale Nursery). On 18 December 2013 Council approved the development application. On 12 February 2014 Council resolved to issue a negotiated decision notice approving the development application. On 7 March 2014 the Barnes appealed against the approval. On 25 March 2014, by letter from its solicitors, Council advised the other parties that it had formed the view that the use was an existing lawful use and that no development application was necessary for its continued operation. The letter invited ‘each party to respond to Council’s position and if appropriate, to discuss this issue at a mutually suitable time so that the parties need not incur further costs’. On 2 June 2014 the appeal was reviewed in this Court and Edgewill foreshadowed that the subject application would be made. On 10 June 2014 the originating application was filed. The appeal has been adjourned to a date to be fixed pending determination of this proceeding.
The statutory framework makes relevant the intensity of a use as at 30 March 1998 and whether there has been a ‘material change of use’ since then
The statutory framework relating to a material change of use and its consequence was not in contest. When the relevant parts of IPA came into force on 30 March 1998 they protected a right to continue lawful uses which then existed. IPA contained the concept of a ‘material change of use’ defined in s 1.3.5 as ‘a material change in the character, intensity or scale of the use of the premises’.[3] Edgewill accepts that IPA did not protect an existing lawful use if there occurred a material change in the intensity or scale of the use after 30 March 1998 and accepts that such a change would constitute a ‘material change of use’ within the meaning of IPA. Queen’s Counsel for the Barnes accepted[4] that it is only the intensification from 30 March 1998 that is relevant to whether there has been a material change of use.
[3]The word ‘character’ in the IPA definition of ‘material change of use’ was later omitted by amendment.
[4]T3-23 lines 1-10
Onus of proof
Edgewill accepts that it bears the onus of proof that the use was established before 29 November 1996, was then a lawful use and that there was no material change of use after 30 March 1998. As for whether there has been abandonment of the use, the Barnes accept that they bear the onus.[5] As for whether there has been no intensification of the use amounting to a material change, Edgewill tentatively accepted that it bears the onus of proof. I proceed on the basis that Edgewill bears the onus of proof that the use has not so intensified since 30 March 1998 as to amount to a material change of use. As for the onus on the issue of whether the use of the premises has included activity in a shade house which may not have building approval, no party made a concession or a submission about the party bearing the onus.
[5]T1-5; second respondents amended outline of argument [52]
The Barnes allege that a shade house did not have building approval and allege it is unlawful because of that. They argue that would be relevant to public policy.[6] It was more fully explained in oral argument thus:
as a matter of public policy and your Honour’s discretion, not to provide an advantage to someone who does conduct their business in unlawful structures or take advantage of the unlawful circumstances
[6]Second respondents amended outline of argument [48]
I distinguish an issue about whether the wholesale nursery use is lawful from this public policy issue. An issue which affects whether a remedy otherwise available to a litigant should be withheld as a matter of policy is like an issue affecting whether a discretion to grant a remedy should be exercised. The Barnes do not raise the absence of necessary approvals as relevant to the matters which concern lawfulness of the wholesale nursery use such as whether it was ‘Agriculture’ under the 1978 scheme, or whether it began before 29 November 1996 or whether there was a material change because of intensification of the use. The Barnes raise the absence of necessary approvals as relevant to a different issue, namely whether the applicants are undeserving of remedy because they use a structure which allegedly lacks approval. In that circumstance the Barnes bear the onus of proof of the matters which would reveal the applicants to be undeserving, including proof that structures are unlawful.
Development of the use to 29 November 1996
In December 1987 Mr Allen erected a 1.8m high galvanised wire mesh boundary fence topped with three strands of barbed wire. It remains in place.
On 11 May 1988 Mr Allen registered Crystal Palm Nursery Pty Ltd. Mr Allen and his former wife were appointed directors in June 1988. That company carried on the fledgling nursery business and had an interest in a fishing vessel. In 1988 Mr Allen purchased and planted palm stock at the front, that is at the southern boundary of the land, along the driveway and adjacent to and within the turnaround area of the driveway and along boundaries. The palms planted at the front of the site and at the turnaround area were intended to be used for seed stock or to dig out and sell.[7] He built a shade house 44m long and 8.5m wide on the western boundary and covered it with 80% shade cloth. He built a shed. He purchased some equipment and fertiliser. Mr Allen began irrigating and spraying. Mr Allen believes that it is not possible to run a commercial nursery business in the tropics without regular irrigation and spraying. He began doing so from the commencement of his wholesale nursery in 1988.
[7]Document 26 paragraph 10.
In 1989 Mr Allen began living on the land.
In 1990 Mr Allen obtained an irrigation license, installed a bore and more irrigation equipment. The bore was to irrigate the nursery. He started growing small amounts of dracaena plant stock in the ground. It was a time for establishing the nursery. There were no sales being made. Mr Allen was buying in seed stock, taking the seeds and propagating the seeds in pots in the shade house. If palms were propagated, they were not propagated in pots but in styrene trays. Mr Allen accepted that the principal business of the company in 1990 was fishing. That seems consistent with the fact that there were no sales from the nursery while it was establishing. An aerial photograph taken that year reveals[8] the portion of the land then devoted for nursery purposes. It was outlined in black by Mr Allen. By then, he had planted palms in-ground along the entire eastern boundary and along his driveway.
[8]Exhibit 1 DNRM Aerial 1990.
In 1991 Mr Allen extended the shed to add a living area. He continued planting a number of different varieties of palms for the seed stock which he would then propagate. He planted these along the western boundary from the shade house to the southern corner of the site and along the driveway and around the turnaround area and on the eastern boundary. The process was that he would buy seed stock, plant it in the ground, as the palms grew and produced seeds he would pick the seeds, plant them in styrene trays, grow them and sell them from the property. An aerial photograph of the land in December 1991[9] has within it delineated in blue the portions of the land identified by Mr Allen as devoted to nursery purposes. I accept that evidence. It shows a substantial growth of palms in the “turnaround area” and up the driveway. It shows that there has been more planting in the north-western corner and at the southern end.
[9]Exhibit 1.
In 1992 the financial statement and tax return for the company recorded its business as a nursery business. In late 1992 Mr Allen built at the northern end of the land a second shade house 30 metres long by 15 metres wide with 50 per cent shade cloth. He also built another shed at the northern end of the land.
In February 1993 Mr Allen and his former wife registered the business name “Marlin Coast Indoor Plant Hire” for use in connection with the wholesale nursery they were establishing on the land. In about April 1993 Mr Allen bought a significant quantity of dracaena stock. It was planted in the ground.[10] He planted a large area of ground stock at the northern end of the land next to the shade house and to the northeast of the turnaround area. Many were planted in rows. Mr Allen had by then changed his focus from palms to dracaenas. He regarded the growth rate for dracaenas as being better than for palms.
[10]T3-9 l 7.
There is an issue raised as to whether palms were abandoned as nursery stock. It is an issue raised for the Barnes. I accept the evidence of Mr Allen that the change of focus to dracaenas did not mean the value and use for the palms was ignored. The in-ground palms remained available to be dug out and sold.[11] Once the palms gained in height they served as a canopy, providing necessary shade for the stock underneath them.[12] For the Barnes, it was submitted that Mr Allen invented in oral evidence his evidence that the business dealt with whole plants. I reject the submission. I accept that in years subsequent to 1993 the business dealt in whole plants. I am satisfied that Mr Allen, in 1993, regarded the in-ground palms as an asset for the nursery business available for sale as whole plants.
[11]T2-66 l 5-8.
[12]T2-66 l 10-13.
In June 1993 the company went into liquidation at the instigation of the Australian Taxation Office. In September and October 1993 there was a sale by the liquidator of the company’s assets. Mr Allen bought the irrigation equipment. On 20 September Mr Allen bought from a nursery supplier in Cairns $315 worth of ‘polypipe’ and assorted things to supplement the irrigation system on the land. At least 3,600 plants were in-ground including rows of dracaenas. Mr Allen bought those in ground plants from the liquidator. He bought the irrigation system for $400 because he needed to keep the stock continually watered. These acts are consistent with Mr Allen’s evidence that he had no intention at the time of the liquidation of stopping the business. There was what he called a “small speed-bump” because the company in liquidation had only recently purchased much of the stock that Mr Allen had to buy from the liquidator. Mr Allen retained the list of clients and he pursued those clients and continued the business with no intention of ever stopping it.[13] Mr Allen bought some potted palms from the liquidator.
[13]T2-83.
Potted dracaenas propagated on the land were first sold at the end of 1993. None had been potted by the time of the liquidation sale.
At about that time Mr Allen and his former wife separated. His former wife had been doing the bookwork. Mr Allen’s paperwork suffered at that time.
In 1994 Mrs Barnes moved in next door, on the eastern side of the land. There must have been substantial plant growth on the land because Mrs Barnes was unaware of the two shade houses which were then on the land.
In 1994 Mr Allen continued to grow, irrigate and fertilise the plants, concentrating on dracaena stock. He continued to plant ground stock. A truck was delivering potting mix, mulch and fertiliser to the site three to four times per year. This had been continuing from about the start of the use and continued until the hearing. The truck would deliver 5 metres of potting mix at a time. By 1994 all of the northern corner was being used to grow in-ground dracaenas and the second shade house and second shed had been built at the northern end of the land for nursery purposes. More dracaenas were also growing along the eastern boundary of the land from the north-eastern corner about halfway along the eastern boundary. Further south along that eastern boundary palms were growing.[14]With the potted palms Mr Allen had bought from the liquidator he continued the indoor plant hire business, Marlin Coast Indoor Plant Hire, for about 6 to 12 months after the liquidation sale.
[14]T2-8 and T2-9.
There was a contest between the parties as to whether the use had intensified over the years to such an extent as to amount to a material change of use. One type of circumstantial evidence of intensity of use was the proportion of the land used for nursery purposes. Aerial photographs were placed into evidence, partly as evidence of the proportion of the total area of the land which was used at any date for nursery purposes. The proportion of the area used for nursery is not the true measure of intensity of use but I accept that for the wholesale nursery use the proportion of the land used is one relevant component of the intensity of the use.
An aerial photograph taken in 1994[15] shows a delineated portion of the land which Mr Allen attributes to use for nursery purposes. Mr Allen with black marking delineated the areas. The only parts which he excluded amount to about 20 to 25%, by my rough estimation. Mr Feros opined that a photograph from October 1994 shows that planting and structures consistent with a nursery occupied about 25% of the area of the land.
[15]Exhibit 1.
There is a significant difference of opinion between Mr Allen and Mr Feros as to what the photographs reveal about the proportions of the land used for nursery purposes, whether for growing plants in ground or for shade houses or storage sheds. By November 1996, about 25% according to Mr Feros as against about 75% according to Mr Allen.
Mr Feros gave his opinions based upon conclusions he drew almost exclusively from the aerial photographs alone. He also approached his task upon the premise that palms stopped serving a nursery purpose in about 1993. He had no personal historical knowledge of the land and what was done on it. Mr Feros was armed with only publicly available photographs. The photographs had not been taken for the purpose of identifying what was growing on the land. He used equipment to magnify them to the optimal extent. The optimal magnification was still inadequate to reveal precisely what the various colours and shadows represented. Mr Feros accepted the instruction that from 1994 in ground palms served no nursery function but only a domestic or ornamental function. In that respect his premise was incorrect. He assumed that the ground stock would have been planted in orderly rows and tended to exclude from his calculations areas of growth which was not in rows. Further, he did not have the benefit of Mr Allen’s instructions as to what the different colours and shadows represented in the older photographs.
I prefer the evidence of Mr Allen to the evidence of Mr Feros as to the portions of the area of the land used for nursery purposes. Those portions were identified by Mr Allen in each of the aerial photographs forming exhibit 1 from 1990 to 2014. I accept that Mr Allen’s evidence was generally accurate as to what the photograph’s show and the proportions of the area of the land used for the nursery.
In 1995 Mr Allen acquired Edgewill to conduct the nursery business on the land.
In about 1995 the business continued propagating dracaenas.
Dracaenas required a minimum of 3 months after planting in ground before their canes were long enough to cut for propagation. Propagation of dracaenas on the land generally meant cutting canes from the in ground stock, treating one end of the cane to encourage root growth, potting the cane in a pot containing potting mix, watering and fertilising it. The potted dracaenas were initially stored in the shade house with the 80 per cent shade cloth. That cloth had been appropriate for palms and for plants which were made available for indoor plant hire but that shade was not ideal for dracaenas. They suffered too much leaf drop. I infer the cloth kept out too much sunlight.
Mr Allen began to operate the nursery in partnership with Mr Vincent Petersen in about late 1994 or in 1995. Mr Petersen continued as the business partner of Mr Allen until about late 1996. While there, Mr Petersen worked on site five days a week and was involved in the day-to-day running of the nursery. Mr Petersen was more involved when Mr Allen was working at commercial fishing. Mr Allen could be away for many months of the year. During Mr Petersen’s time on the land he recalled the gradual swapping of palm stock for dracaena stock and the shifting focus to dracaenas. Even before the registration of the business name “Cascade Dracaenas” he and Mr Allen were trading as “Cascade Dracaenas”.
Since ending his business on the land in late 1996, Mr Petersen has visited the site regularly, about several times a year. While he observed that over the years the shade houses had changed, he regarded the business these days as not very different from how it had been in late 1996 with areas planted with ground stock, plant stock also in pots and with sheds and shade houses being used for the nursery. I accept that his general impression is accurate. It assists me to determine whether by November 1996 there was a wholesale nursery use on the land.
The work required for the mother stock of dracaenas planted in ground was explained by Mr Allen. He did not discriminate from one year to another. I accept that this was generally applicable to the dracaena mother stock and any other in ground stock before and after November 1996. They were watered by an irrigation system at night and automatically. The irrigation system does not contain fertiliser. The in ground plants were fertilised as required and generally only once a year. To keep in ground plants clean around the edges, the herbicide Roundup was applied. The plants were mulched. Sometimes, the dracaena mother stock would need to be cut back if it had not been used recently to take cuttings for the purpose of propagating dracaenas.
While Mr Petersen was there until late 1996, the nursery generally operated with only one full time staff member, Mr Petersen.
The majority of the time taken to run the nursery, once the focus had turned to dracaenas, was required for the production and nurturing of potted dracaena stock for wholesaling. The primary product for wholesaling was the potted dracaena. Initially, the nursery grew larger quantities of green dracaenas.
To produce potted dracaenas for sale, canes would be cut from the mother stock, placed on a trolley and taken to benches. The canes would be laid out on benches and then stripped of leaves and separated according to size. They would be sized in accordance with the pot to which they would be matched. The longer canes needed a bigger pot. The benches would be preloaded with pots. The cuttings would then be taken by trolley to another area for a treatment. One end of the cutting would be soaked in a liquid root-striking hormone for 15 to 20 minutes then put back on a trolley to be wheeled back to a bench where the appropriate pots were. One or two canes would be manually placed in each pot. Commercial potting mix containing some soil would be added.
What was done to the potted dracaena canes? The potted cuttings would be fertilised and treated with a seaweed solution. I infer that occurred immediately after potting. Sometimes the potted plants needed a pesticide spray. The pots were irrigated automatically several nights each week. The potted canes were allowed to grow for six to eight weeks to reach appropriate maturity for sale. Sometimes pots were kept for up to two years. Sometimes pots needed weeding. Once the potted canes were selected for supply to a retailer the foliage was trimmed to remove any dead or unattractive parts. The pots would be cleaned. A pot was then ready for transport.
I infer that for any individual potted dracaena cane or pair of canes, the time taken to cut the cane, size it, dip it, place it in a pot with potting mix, drop fertilizer on top and water it with seaweed solution would be a few minutes, if one excluded waiting time while a cutting’s end soaked in root-striking hormone. To then produce a saleable dracaena it was left to grow for 6 to 8 weeks before a few more minutes may have been devoted to trimming its leaves, cleaning its pot and loading the pot for transport.
There was no evidence as to the quantities sold in 1995. I infer from the fact that Mr Petersen was working full time at the nursery that there were sales.
Mr Allen was concerned in 1995 that the shed which he had extended in 1991 may not have had building approval. He believed that in 1995 the Council had an amnesty for structures. Because of that belief, Mr Allen engaged a building inspector to draw up the plans of the shed. It was approved retrospectively.
From 21 February 1996 Edgewill’s principal place of business has been registered as at the land. I am satisfied that by this time the primary focus for the nursery business had shifted from palms and was upon dracaenas. There may, by then have been other small plants too; bromeliads and cordylines. These were introduced at some stage in the history of Edgewill’s nursery business. Precisely when is not relevant to the intensity issue because they are a minor component of the stock. In 1996 on 1 August Mr Allen and Mr Petersen established a registered business name ‘Cascade Dracaenas’ which was then acquired by Edgewill. Mrs Petersen was doing the books for the nursery. A photograph from 1996 reveals that a 6m x 6m patch of palms had grown significantly since 1994. It was one of the areas of land which Mr Feros excluded, incorrectly, from his calculations of the area used for the nursery.
In about 1996 a semi-trailer would visit the property once or twice per year to take delivery of pots. I infer that the delivery was of pots containing plants for sale, that they were primarily dracaenas, and that they had been grown from cuttings from mother stock which had grown on the land and that the dracaenas in pots had grown for 6 to 8 weeks in pots nurtured on the land as described above.
Did the current wholesale nursery use begin before 29 November 1996?
Did the current wholesale nursery use begin before 29 November 1996? For the Barnes it was submitted that the objective photographic evidence shows that the use did not start by that date. As I accept Mr Allen’s evidence as to the proper interpretation of the photographs and Mr Allen’s and Mr Petersen’s evidence about the events they purported to recall to the end of 1996, it follows that I reject this submission for the Barnes. I reject the further submission to the effect that by the end of 1996 the state of the use was that there were palms which had been abandoned as potential assets and no relevant use of dracaenas.
Mr Allen’s plan for a wholesale nursery was the basis for numerous continuous activities up to 29 November 1996: his several years of planting stock in ground before liquidation; his purchase in 1993 of that in ground stock from the liquidator; his taking Mr Petersen as a partner, the construction of a second shade house by 1994; the presence of his partner working full time on the land in 1995 and 1996; the use of a bookkeeper in late 1996; the maintenance of more than 3600 growing plants in ground with irrigation, mulching, fertiliser and herbicidal weeding; the purchase of regular deliveries of potting mix, fertiliser and mulch; the use of a large proportion of the land, increasing to about 75% to 80% for nursery purposes by late 1994; increased planting of the fast growing dracaenas; propagation of dracaenas in pots; irrigation of pots in shade houses for potted palms propagated from seed and dracaenas propagated from canes; the use of the business name; the registration of the company and the transfer of the business name to the company; and a sale or sales of pots by one or more semitrailer loads. Those activities for the purpose of that plan satisfy me that a wholesale nursery use had begun before 29 November 1996.
Was the use on 28 November 1996 lawful ‘Agriculture’ or unlawful ‘Rural Industry’?
The Barnes accepted that the growing of dracaena mother stock, if that could be looked at in isolation, was ‘Agriculture’. I find that, if looked at in isolation, it was. That is not a resolution. The propagation of potted canes is the issue. It was an essential part of the operation and there is an argument that that propagation component looked at in isolation is ‘Industry’. The applicants and the Barnes each submitted that the court should look at both phases of the production together when considering the whether the use was lawful ‘Agriculture’ or unlawful ‘Rural Industry’. I accept that is appropriate in this case.
For the Barnes it was submitted that there was a dominant use; that the dominant use was the propagation process after the dracaena canes were cut from the mother stock. The applicants submitted that there was a principal use; that the growth of the mother stock was the principal use. For the activities on this land it seems to me that the principal activities were growing the in ground dracaena stock and potted dracaena stock. Mother stock was grown for a minimum of three months before its canes could be harvested for propagation. The mother stock was then allowed to continue to grow so as to produce more canes for harvesting. The period required to allow for another harvesting was not expressed. Meanwhile, in the shade houses dracaena cuttings were growing for 6 to 8 weeks at a minimum and were growing into dracaenas with roots and leaves. The labour component for propagation of a cutting was a matter of minutes and the time devoted to leaving the cutting to grow was 6 to 8 weeks. I regard the principal activity in the shade house as allowing plants to grow.
For the Barnes it was submitted that 90% of the plants sold were those which had been propagated. That may be numerically so prior to 28 November 1996. It seems reasonable to assume that 90% of the plants sold in the year or so to 28 November 1996 were dracaenas which had been propagated at the nursery and that the work then being done in the nursery was with a view to continuing to focus on propagation of dracaenas for sale with more than 90% of the working hours being directed to that purpose.
For the Barnes it was submitted that the shade house was a necessary component for the propagation work and necessary for making the business economically viable. I accept that.
Those findings are relevant to one contest between the parties which arose from the definition of ‘Use’ in the 1978 Scheme. ‘Use’ was defined to include ‘any use which is incidental to and necessarily associated with the lawful use’. To assist with determining whether the use was lawful ‘Agriculture’ or unlawful ‘Rural Industry’ the parties submitted that the court should determine which activity was incidental to the other: whether growing mother stock was incidental to propagating potted dracaenas or whether propagating potted dracaenas was incidental to growing mother stock. The parties took opposing positions.
For the Barnes it was submitted that the nursery could buy canes elsewhere for propagation and that it must follow that the phase of the keeping the mother stock was a use incidental to and necessarily associated with the propagation phase. I accept that the keeping the dracaena mother stock was a use incidental to and necessarily associated with the propagation phase. But counsel for the Barnes submitted that propagating canes cut from dracaenas is not incidental to and necessarily associated with growing mother stock, because the canes could be imported from elsewhere. Superficially it is correct. Canes could have been imported from elsewhere and used for propagation on the land. This may even have happened in the life of the nursery. If it happened before 28 November 1996 it must have been in insignificant amounts and for creating plant stock for planting for future mother stock. If it happened on the land before 28 November 1996 it was not for selling the propagated canes by wholesale.
The nursery’s former owner had recently been liquidated. Mr Allen’s and Mr Petersen’s business plan was to grow dracaenas in ground on site as a source of canes. Implementation of that plan did not include the interim importing of canes for propagation for potted plants for sale. I infer that the nursery would not have been financially viable following a business plan of purchasing canes from elsewhere for propagating dracaenas for sale. I find that the mother stock of in ground dracaenas was grown by Mr Allen and Mr Petersen for the primary purpose of producing canes for propagation to grow potted dracaenas for wholesale.
I find that the propagation phase for the dracaena canes was incidental to and necessarily associated with growing dracaena mother stock. That tends to favour the argument for the applicants and council that the use was ‘Agriculture’. But one need not determine whether the use of the land was ‘Agriculture’ by the tortuous route of determining whether the propagation phase was incidental to and necessarily associated with the ‘Agriculture’ use of growing mother stock.
The propagation phase generally involved 6 to 8 weeks of growing dracaenas in pots in a shade house. In fact they sometimes stayed growing for up to two years in pots. The shade house was ‘a structure used or intended for use for the growing of crops’. The fact that the cut canes were grown in pots does not prohibit the use of the structure from falling within the ‘Agriculture’ use. The definition expressly contemplates use of buildings for growing.
The Barnes submitted that cutting of the canes from the mother stock in combination with the propagation phase was ‘Rural Industry’. If one could properly ignore the phase of growing involved with the mother stock and focus as their submission requires on the last 8 weeks of a cane’s time at the land one would observe that a few minutes of labour cutting, sizing, leaf stripping, dipping and potting a cane precede 6 to 8 weeks of growing before a couple of minutes are devoted to tidying the leaves, cleaning the pot and loading it for transport.
I do not regard the potted dracaenas as having been produced from a ‘manufacturing’ process but rather from two growing processes. I do not regard the cutting of the canes or the stripping of leaves from cut canes before potting, or the trimming of leaves to make the plant appear attractive before loading for transport to the retailer as the breaking up or dismantling of any goods or, any article for trade, sale or gain within the definition of ‘Industry’. Handling of a cut cane, treating it, packaging it in pots of potting mix and putting it through a trimming process after it has propagated arguably conforms with the words found in the definition of ‘Rural Industry’.
The fact that crops grown on a farm are eventually cut on the farm when harvested and handled or processed on the farm to a small extent necessary to prepare the crops for transport would not ordinarily suggest that the use of the land is industrial as opposed to agricultural. That is primarily because the major component of the process of producing the crop is sowing and growing. I regard the small labour components at the start and end of the propagation phase as being akin to sowing and preparation for transport. The 6 to 8 week period of the propagation phase when the plants are left, mulched, fertilised and automatically irrigated is a growing phase as opposed to a treatment or storage phase. The spraying of canes with pesticide, if required, appears to conform to an aspect of the definition of ‘Industry.’ But it is also consistent with common practice for agriculture and does not change the character of what occurs in the propagation phase - growing.
For the Barnes it was emphasised that workers on the land were permitted to use a toilet and that the nursery business had a bookkeeper and these facts are consistent with the definition of ‘Industry’. That does not seem a strong argument.
On the proper construction of the 1978 scheme, the primary use of the land was for growing: in ground stock for its canes and potted canes was for marketable dracaenas. That use was ‘Agriculture’. Thus, the use was lawful in November 1996.
History of the use to 30 March 1998
History of the use to 30 March 1998 is relevant to establish the intensity of the use at that date so that may be a benchmark for comparison with future intensity of the use. That allows for assessment of whether there has occurred a material change of use by reason of intensification.
From about 1998 a truck began to call at the site to collect stock once per week during the times when stock was available. There were about 30 collections a year from 1998. On the south-western boundary of the land some palms were removed and dracaenas were planted there. In 1998 an extension to the house on the land began. More palms were replaced by dracaenas. In 1998 there may have been an increase in the quantity of potted stock sold. Instead of one or two semitrailer loads collected per year there were almost weekly collections by truck. If that was a material increase in intensity it is not a disadvantage to the applicants because it was occurred in and from 1998.
The areas of the land used for the nursery use had changed little since 1996.
In about May 1999 Ms Smith began to work at the land doing the bookkeeping. She recalls that the number of in-ground plants was about 3,000, generally planted in rows and that the number is much the same as it was in 2014, though the plants have grown taller. I regard the estimate by Ms Smith of the number of in ground plants to be generally consistent with the estimates of Mr Allen and with the inventory of the number of plants purchased in 1993 from the liquidator. When Ms Smith began, she recalls the practice to have been to employ extra staff once or twice per year for a day or two when the business was proposing to sell “tops”. That is consistent with evidence of Mr Allen as to the practice during the life of the nursery. Each suggested that generally the nursery required only one full time worker. I am satisfied that the labour needs for the nursery did not intensify in a material way.
In November 1999 Mr Barnes first visited the Barnes’ property to the east of the subject land. He did not see the long greenhouse on the western boundary of the land. That is consistent with the foliage on the land obscuring Mr Barnes’s line of sight.
In about August 2002 a new shade house was built near the eastern boundary of the land to replace the shade house on the western boundary. The new shade house was covered with 30% cloth. When this shade house was constructed, Mr Allen did not seek any building approval because he believed it was not necessary as the greenhouse was not ‘structural’. Being a replacement, I am satisfied that it is not a material intensification.
In about 2002 and 2003 the six metre by six metre bed of palms was removed and replaced with dracaenas.
In about 2010 Ms Smith began doing hands on work in the nursery. This was not because the business had grown, but because she wanted to be more involved. She was the de facto partner of Mr Allen. There was then a full time employee. Once Ms Smith began to work in the nursery, the full time employee’s hours were cut back.
In 2011 there were some sales of in ground mature palm stock. The aerial photograph from 2011 creates the false impression that there is less plant stock. That was explicable because dracaenas had been cut back and palm stock sold.
In September 2013 Ms Smith told Mr Woolgar that there was ‘currently not a lot happening’ with the business. She had not intended to convey the impression that the business was not continuing. The business was continuing. In particular it was continuing to supply Bunnings. Bunnings orders are responsible for about 80% of the nursery’s sales. Bunnings orders almost weekly.
A small component of sales is of ‘tops’ and bare rooted plants. For the one or two days a year devoted to the sale of these items, an extra paid employee or two has been engaged. Ms Smith and Mr Allen do not draw wages. The average for paid employment since Mr Petersen left has been the equivalent of one full-time employee until 2010.
Between 1999 and 2014 turnover has probably reduced.
The Barnes formed the belief that the intensity of the use increased because they became more aware of poisoning in recent years. There are still mature palms in the ground at the nursery. There is a market for such palms. If an offer were made to purchase them Mr Allen would sell them.
The nursery does occasionally buy potted dracaenas if it needs extra colours for a batch to be supplied to Bunnings.
Has there been material intensification of the use?
The relevant starting point is 30 March 1998. The intensification relied upon after that date by the Barnes depends largely on my acceptance of the evidence of Mr Feros as to the proportion of the land devoted to nursery use. For reasons explained above, I reject the conclusions drawn by Mr Feros from aerial photographs. The proportion of the land used for the nursery has remained roughly the same since 1994. The quantity of dracaena stock in ground has not increased markedly and neither has production of pot plants. Pot plant turnover in 1914 was not greater than in 1999 and may have reduced. The number of deliveries of mulch, fertiliser and potting mix have been consistently about four deliveries annually. The staff numbers have not intensified. The Barnes consciousness of spraying suggests to them that there has been intensification of the use. I accept that their belief is genuine. I am not satisfied that there has been a material increase in the volume of pesticides or herbicides sprayed. There has not been a material increase in vehicles or equipment used on the land.
I am satisfied that there has not been material intensification of the use.
Abandonment
It was submitted for the Barnes that if the wholesale nursery use began, it was abandoned as a consequence of the liquidation and that there is no credible evidence that the business was transferred to Edgewill.
Firstly, I accept that the wholesale nursery use had commenced prior to the liquidation. Secondly, there is credible evidence that after the liquidation the business was carried on by Mr Allen and Mr Petersen and then by Edgewill. Thirdly, abandonment in 1993 is irrelevant so long as the current wholesale nursery use began before and was continuing on 29 November 1996. It did and it was.
The arguments which focus on the events of 1993 as a basis for submitting that the current use is unlawful are rejected.
The Barnes also argue that abandonment occurred in 2013. That is inconsistent with the evidence. I reject it.
Public policy issues
The Barnes allege that there are unlawful structures on the land. The state of the relevant evidence about the need for approval is that a shade house has been erected on the land near the south eastern boundary without approval. It has been used for nursery business. Queen’s Counsel for the Barnes submitted it ‘would require approval by the relevant government authority’. Counsel for the applicants did not concede that this was so. Mr Allen, whose opinion is irrelevant to whether approval is needed, gave evidence that he did not think approval was required because the shade house was ‘not structural’. The Building Act was referred to by Queen’s Counsel for the Barnes but no section of that Act was cited and the submission was not developed. Queen’s Counsel for the Barnes advised that he needed to supplement his submissions with further submissions on this point and he was at liberty to do so.[16] No further submissions on the point were made. I am not satisfied by the Barnes that structures on the land are unlawful for want of a building approval. On the hypothesis that my finding is wrong and that the shade house erected near the south eastern boundary requires a building approval, I should make further findings. I accept that Mr Allen was not aware of the need for approval. Edgewill’s use of the shade house, if unlawful, was not in wilful disregard of the requirement for a building approval. If approval is required, the Council will have a remedy available to it. It is reasonable to infer that approval for the shade house may be applied for and may be granted. That occurred for a shed which needed approval and had been built without it. I am not persuaded that the past use of a shade house built without approval would be sufficient reason to refuse the declarations in this case.
[16]T3-87
Conclusion
The applicants are entitled to the two declarations they seek.
In respect of costs it is appropriate to give liberty to each party to apply by giving notice of the order sought to the other parties and electronically to my associate by 4.00 pm on 10 July 2015 and by supplying any submissions on costs in writing electronically to the other parties and to my associate by 4.00 pm on 17 July 2015 and by supplying any submissions in reply in writing electronically to the other parties and to my associate by 4.00 pm on 24 July 2015.
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