Artazan Property Group P/L v City of Sydney Council - [2012] NSWLEC 1164

Land and Environment Court

New South Wales

Medium Neutral Citation: Artazan Property Group P/L v City of Sydney Council [2012] NSWLEC 1164
Hearing dates: 16-18 April 2012
Decision date: 18 June 2012
Jurisdiction: Class 1
Before: O'Neill C
Decision:
1. The appeal is upheld.
2. Development Application No D/2011/566 for an extension of an existing sex premises is approved subject to the conditions in Annexure A and the Plan of Management in Annexure B.
3. The exhibits are returned except for exhibits 1, 8, 9, 10, A and J.

Catchwords: DEVELOPMENT APPLICATION: extension of existing brothel, appropriateness of location, FSR, parking and traffic impacts and the public interest and weight to be given to the draft LEP.
Legislation Cited: Environmental Planning and Assessment Act 1979
Land and Environment Court Act 1979
Cases Cited: AJA Trading Pty Ltd v Waverley Council [2005] NSWLEC 253
Jonah Pty Limited v Pittwater Council [2006] NSWLEC 99
ROI Properties Pty Ltd v Council of the City of Sydney [2001] NSWLEC 1023
Schaffer Corporation v Hawkesbury City Council (1992) 77 LGRA 21
Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) NSWCA 289
Category: Principal judgment
Parties: Artazan Property Group (Applicant)
Sydney City Council (Respondent)
Representation: Counsel
Mr Peter Tomasetti SC (Applicant)
Ms Sandra Duggan SC (Respondent)
Solicitors
Henry Davis York (Applicant)
City of Sydney Council (Respondent)

File Number(s): 10946 of 2011

Judgment

COMMISSIONER: This is an appeal pursuant to the provisions of s97 of the Environmental Planning and Assessment Act 1979 against the refusal of Development Application No. D/201/566 (the application) by the Council of the City of Sydney (the Council) for the extension of an existing brothel at 82 - 86 Parramatta Road, Camperdown (the site).

The appeal was subject to conciliation on 9 December 2011 in accordance with the provisions of s34 of the Land and Environment Court Act 1979 (LEC Act). As no agreement was reached during the conciliation phase, the conciliation conference was terminated pursuant to s 34(4) of the LEC Act on 31 January 2012.

Issues

The contentions raised by the Council can be summarised as:

The location of the expanded premises are incompatible with the neighbouring residential flat buildings;
Exceeding the floor space ratio (FSR) results in an intensification of use that will have a detrimental impact on the surrounding residential area;
The position of the entry on Larkin Street and exits to Sparkes Street and the entry and exits to the basement carpark on Sparkes Street will compromise the amenity of neighbouring residential areas by way of excessive activity, pedestrian and traffic movement and the presence of security staff;
The parking and traffic impacts of the proposal will be unacceptable; and
The proposal is not in the public interest.

At the commencement of the proceedings, the applicant sought to amend the proposal to provide for a revised ground floor plan (DA105 Rev 13 dated 13.4.12) that requires patrons to exit the premises to Parramatta Road. A further amendment relocates the two 'exit lounges' from the northern side of the building adjacent to Sparkes Street to a position adjacent to the corridor of the exit door to Parramatta Road. The amended ground floor plan deletes the proposed retail space on Parramatta Road and replaces it with a storeroom and a ground floor art installation elevation to Parramatta Road. As the amendments to the plan reflected amendments that could have been addressed by way of conditions of consent, the revised Ground Floor plan was tendered as Exhibit G.

During the proceedings, the parties agreed to amend the without prejudice conditions of consent (Exhibit 15) and the Plan of Management (Issue F, Exhibit 14), following consultation between the experts. The amendments include: closing the basement car park between 10pm and 7am, 7 days a week (except for use by staff and people with a physical disability and a valid Disability Parking Permit) and deleting an existing set of fire egress stairs to Sparkes Street subject to compliance with the fire egress requirements of The Building Code of Australia (BCA).

The issues that remain in dispute, following further discussions by the experts, the amendment of the ground floor plan and the amendment of the conditions and Plan of Management are:

Whether the proposal is compatible with the residential flat buildings in the mixed use zone; and
What weight should be given to the calculation of the FSR under the provisions of the Draft Sydney Local Environment Plan.

Contentions in relation to the conditions of consent and the Plan of Management are:

The minimum number of security personnel required during peaks times;
Whether the proposed external signage strategy is acceptable;
Whether a retail tenancy fronting Parramatta Road should be included in the proposal; and
Whether the proposed ground floor art installation elevation to Parramatta Road is acceptable.

The site and its context

The existing building at 82 Parramatta Road consists of three storeys and a basement car park; the third floor being contained within the roof structure. The site area of 82 Parramatta Road is 624m2. The existing building is used as sex premises, trading as 'Stiletto' and operating 24 hours a day, 7 days a week with 19 work rooms, 8 waiting rooms, facilities for support staff and management and an escort service. The basement houses 7 car parking spaces and the laundry. The sex premises have been operating since 2002.

The site at 84 Parramatta Road is vacant and is used as an on-grade car park (without consent), with a boom gate at the driveway access from Sparkes Street. There is an existing two storey commercial building at 86 Parramatta Road, which is currently unoccupied. The site area of 84-86 Parramatta Road is 789m2.

Behind the sex premises, and separated by Sparkes Street, at 23-27 Sparkes Street, is a residential flat building currently under construction, consisting of 4-5 storeys and a basement car park and containing 16 apartments and a roof terrace. There are two entries to the main lift lobby, one from Sparkes Street opposite the vacant lot at 84 Parramatta Road and one from Larkin Street.

Diagonally across the intersection of Sparkes and Larkin Streets, at 16-20 Larkin Street, is a residential flat building, consisting of two blocks, both with balconies oriented towards the north.

Adjoining the site to the west, at 88-90 Parramatta Road is a three storey building owned by the University of Sydney. Behind 88-90 Parramatta Road and at the western end of Sparkes Street is the Medical Foundation building, part of the University of Sydney.

To the east of the site, separated by Larkin Street, at 80 Parramatta Road, is a 1-2 storey commercial building.

There are residential flat buildings towards to the northern end of Larkin Street and a public park on the eastern side of the northern end of Larkin Street.

St John's College oval, part of the University of Sydney campus, is on the southern side of Parramatta Road.

Background and the proposal

The proposal is to retain the existing building at 82 Parramatta Road with minor internal alterations. A three storey building and basement car park is to be constructed on the adjacent sites at 84-86 Parramatta Road. The new building will connect to the existing building on each level via openings in the party wall.

The proposal is to provide a total of 40 working rooms, 21 waiting rooms, 24 basement car parking spaces and the premises will operate 24 hours a day 7 days a week.

The planning framework

The site is within Zone No. 10 - Mixed Use Zone pursuant to the provisions of the South Sydney Local Environmental Plan 1998 (LEP 1988). Sex premises is a use permitted with consent in this zone.

'Sex industry premises' are defined by DCP 2006 at clause 2.2.2, as follows:

Sex industry premises comprise premises where sexual acts or sexual services are provided, and sex on premises venues. These include:

(i) Brothels;

(ii) Safe house brothels for street-based sex workers;

(iii) Sex on premises venues;

(iv) Swingers clubs; and

(v) Bondage and discipline parlours.

The principal objectives of LEP 1998, at clause 7, are:

(a) to ensure a sustainable City of South Sydney through the efficient and equitable management and allocation of resources, and

(b) to enhance the quality of life and well-being of the local community, and

(c) to implement the goals and objectives contained in the Strategy for a Sustainable City of South Sydney published in June 1995 by the Council, and

(d) to repeal all the existing local environmental planning instruments applying to the land to which this plan applies to the extent to which they apply to that land, and to replace those controls with a single local environmental plan, and

(e) to rationalise the former land use restrictions by creating a small number of zones, and

(f) to create an integrated planning framework of land use controls which allow detailed provisions to be made in development control plans.

Clause 10 of LEP 1998 provides that consent must not be granted unless the consent authority is of the opinion that the proposed development is consistent with the objectives of the zone.

The objectives of the Mixed Use Zone, at clause 21 of LEP 1998, are:

(a) to allow, in appropriate circumstances, a mixture of compatible land uses such a residential, retail, commercial, light-industrial and industrial development, and

(b)to promote mixed use planning by locating mutually supportive and compatible uses such as residential uses, places of employment and retail uses in close proximity to each other so as to minimise vehicular travel, and

(c) to permit appropriate forms of residential development within the zone to mutually support the vitality of nearby commercial and urban village centres, and in doing so, assist successful urban consolidation, and

(d) to incorporate contemporary urban design principles in the design of new buildings and the interpretation of their relationship with the public domain, and

(e) to implement the principles of energy efficiency, travel demand management and other sustainable development practices as part of the development assessment process, and

(f) to encourage the integration of suitable employment and resident intensive activities into accessible locations so as to maximise public transport patronage and encourage travel by foot and bicycle from surrounding areas, and

(g) to minimise any adverse impact on residential amenity by devising appropriate design assessment criteria and applying specified impact mitigation requirements by the use of development control plans, and

(h) to ensure that the nuisance generated by non-residential development, such as that related to operating hours, noise, loss of privacy, vehicular and pedestrian traffic or other factors, is controlled so as to preserve the quality of life for residents in the area.

Clause 28 of LEP 1998 provides that the consent authority must take into account built environment design principles, as follows:

(1) The Council, in determining an application for consent to the carrying out of any development on land to which this plan applies, must take into consideration whether the development:

(a) has been designed to reinforce and protect the local topography and setting, and

(b) reinforces and enhances the streetscape and character of the locality, and

(c) is compatible with the scale and design of neighbouring development, and

(d) has been designed with adequate provision for the intended occupants, and those in the vicinity of the site of the proposed development, in terms of:

(i) privacy, and

(ii) access to sunlight, and

(e) has been designed so as to be energy efficient in terms of natural:

(i) lighting, and

(ii) ventilation, and

(iii) heating and cooling, and

(f) establishes and enhances the public domain, and

(g) has been designed so as to preserve predominant view lines and vistas enjoyed from parks, reserves, roadways, footpaths and other areas of the public domain, and

(h) encourages complementary land uses and activities.

The site is located within the B4 Mixed Use Zone under the Draft Sydney Local Environment Plan 2011 (draft LEP) and would be permissible with consent under the provisions of the draft LEP. The objectives of the B4 Mixed Use Zone are:

To provide a mixture of compatible land uses.
To integrate suitable business, office, residential, retail and other
Development in accessible locations so as to maximise public
Transport patronage and encourage walking and cycling.
To ensure uses support the viability of centres.

The Council tendered a proposed addition to the draft LEP, clause 7.25 (Exhibit 13). Council has not publicly exhibited the proposed clause. The clause states:

(1) Development consent must not be granted to development for the purposes of sex services premises in a building that contains a dwelling if any part of the access to the sex services premises is shared with a dwelling.

(2) In deciding whether to grant development consent to development for the purpose of sex services premises, the consent authority must consider the following:

(a) whether the operation of the sex services premises will be likely to cause a disturbance in the neighbourhood because of its size, location, hours of operation, clients or the number of employees and other people working in it,

(b) whether the operation of the sex services premises will be likely to interfere with the amenity of the neighbourhood,

(c) whether the operation of the sex services premises will be likely to cause a disturbance in the neighbourhood when taking into account other sex services premises operating in the neighbourhood involving similar hours of operation.

Relevant Development Control Plans for the site include:

South Sydney Development Control Plan 1997: Urban Design (DCP 1997)
City of Sydney Adult Entertainment and Sex Industry Premises Development Control Plan 2006 (DCP 2006)
South Sydney Development Control Plan No. 11 - Transport Guidelines for Development 1996 (DCP 11)
City of Sydney Signage and Advertising Structures Development Control Plan 2005 (DCP 2005)

The FSR for the site and surrounding area to the north of Parramatta Road is 2:1 (DCP 1997 Maps: Floor Space Ratio, South).

Part E of DCP 1997 addresses environmental design criteria. Clause 2.2 FSR, includes performance criteria, as follows:

The maximum FSR a site can achieve is determined by the environmental constraints of the site, in particular:

overshadowing and privacy

streetscape
parking and landscape requirements
visual impacts and views
capacity of the community infrastructure and the road network to support the development.

Section 2.2 of Part E, DCP 1997 provides a bonus FSR incentive up to 0.25:1 of the total site area at the discretion of Council on the basis of a number of possible contributions by the applicant. The applicant offered a voluntary planning agreement (VPA) (pursuant to the provisions of s93L of the Environmental Planning and Assessment Act 1979) for a monetary contribution of $391,930.00 for the floor space above the FSR of 2:1, which represents a rate of $385 per m2, as part of the development application. The applicant no longer proposes to enter into any VPA (Exhibit A at 17(b)).

The objectives of DCP 11, at clause 1.2, include:

To ensure that an acceptable level of parking is provided on-site to minimise the unreasonable overflow of parking onto surrounding streets.

DCP 11, includes, at clause 1.3, qualification on the application of guideline parking rates, as follows:

it is important to appreciate the parking rates do not represent a code that should be blindly adhered to. Rather, they are generalised rates that would achieve the above objectives in most circumstances. Applications are assessed under a system of merit of weighing up the balance of differing issues. There is scope, both considering the issue in isolation and considering the project holistically, for the parking provision to be flexible to suit particular circumstances and local conditions.

However, any departure from the Guideline rate must be adequately explained and justified by an applicant if their proposal is to be supported.

Clause 3.2.1 of DCP 11 provides concessions to reduce car parking, including:

The size and type of development and the degree of impact on local parking conditions should provision be reduced;
The availability of car parking on-street.

Clause 2.4 of DCP 2006, Intensification of Use, means that an extension of the existing sex premises is subject to the controls of DCP 2006, as follows:

Where an existing adult entertainment or sex industry premises seeks to intensify its use through the introduction of a new "high impact" use, an increase in the number of working rooms, cubicles or booths, an increase in the number or size of performance areas, or an increase in floor area, the provisions of this DCP including the location controls, will be applied.

DCP 2006 provides additional provisions to the relevant LEP (in this case, LEP 1998) associated with the location of sex industry premises in relation to existing residential and sensitive land uses. Clause 3.1.2, Controls, includes at (1) states:

Adult entertainment and sex industry premises must not be located in areas zoned residential, within buildings containing a residential use, or immediately adjacent to or directly opposite (any elevation) land developed for residential purposes. Adult entertainment and sex industry premises must be separated from land developed for residential purposes by at least one other non-residential land use.

Public Submissions

The hearing commenced on-site, where evidence was heard from Sergeant Garry Coffey, Leichhardt Local Area Command, NSW Police Force and from two residents of the residential flat building at 16-20 Larkin Street.

Sergeant Coffey is concerned that the existing brothel serves alcohol to patrons without a liquor licence. In his written submission, Sergeant Coffey refers to a breach of s7 and/or s8 of the Liquor Act 2007, as the cost of the 'complimentary' alcoholic drinks served in the brothel to patrons is incorporated into the payment for admission or other activities. He cites two recent incidents at the brothel; a drunk patron who caused malicious damage to the bar area and was taken into custody and charged and a drug overdose in the basement car park, in his opposition to the application.

A letter was provided by Mr Peter Bailey (Exhibit L), who was a member of the New South Wales Police Force for a period of 40 years. Mr Bailey's most recent position was the Crime Manager at the Leichhardt Local Area Command, a position he held from 6 December 2005 until 1 March 2012. Mr Bailey states that there were no complaints from residents in regard to the existing brothel and that there was no criminal impact on the community from the use of the premises.

The residents of 14-16 Larkin Street state that they bought their apartment two months ago, on the basis that they understood the expansion of the brothel was not proceeding. In their opinion, the doubling of the size of the brothel is not appropriate and the residents were concerned about the notoriety of 'Australia's biggest brothel'. They feel that the expansion of the brothel is incompatible with the residential area and it will impact on the 'spirit of the community'. One resident described how she had seen drug affected workers outside the brothel and that she had seen drunken patrons in Larkin Street with a security guard present and had felt concerned for her safety. She had been stopped by security personnel whilst driving up Larkin Street and objects to traffic being stopped and directed because of the existence of the sex premises.

Council received 80 submissions during the public exhibition of the development application. The submissions were categorised by Dr Ryan, the applicant's social planner, into key issues that were of concern to the resident objectors. The submissions were then analysed by tallying the number of times each issue was raised. The concerns most often mentioned, in descending order, were:

parking,
behaviour of patrons and staff,
traffic,
a sex premises is an inappropriate use in the area,
safety and security,
decrease in property values, and
intensification/scale.

The concerns raised by the submissions are generally covered in the contentions raised by Council and the expert evidence.

Expert Evidence

Expert evidence was provided on behalf of the applicant from Mr Jason Perica (planning), Dr Roberta Ryan (social planning), Dr Renzo Tonin (acoustic) and Mr Graham Pindar (traffic).

Expert evidence was provided on behalf of the respondent from Mr Kerry Nash (planning), Mr Neil Gross (acoustic) and Mr Chris Hallam (traffic).

Is the proposal consistent with zone objectives?

Evidence

The planning experts agree on the following:

There is no evidence that there is any crime associated with the existing brothel and there has been no record of complaints from Council, NSW Police Service or any other authority prior to the exhibition of the proposal.
The amenity impacts of the proposal are confined to Sparkes Street during the night and those impacts can be managed through the conditions of consent and Plan of Management, although, Mr Nash contends that the future residents of 23-27 Sparkes Street may experience sleep disturbance and nuisance from vehicles in Sparkes Street during the night.
There are good public transport services to and from the site.
Disabled patrons, with a valid Disability Parking Permit, will be able to use to the basement car park at any time.
The relocation of the pedestrian exit to Parramatta Road is a significant improvement.
The closure of the basement car park to patrons during the defined night period and the relocation of the pedestrian exit to Parramatta Road represent a positive benefit to the residential flat building at 23-27 Sparkes Street and these changes will ameliorate the impacts of the proposal on the residents' amenity.

The planning experts, however, disagree whether the extension of the sex premises is compatible with the residential flat buildings in the vicinity of the site. According to Mr Nash, the character of the area has changed since the approval of the sex premises in 2001 and there are now a greater number of residential flat buildings in the Mixed Use zone than there were in 2001. In 2001, the immediate vicinity of the site was industrial in character.

The planning experts disagree as to whether the proposal is consistent with the objectives of the Mixed Use zone. According to Mr Nash, the proposal is inconsistent with the residential uses with the Mixed Use zone, on the basis that the peak time of trading is during the night when residents are sleeping. I understand his evidence to conclude that the proposal is inconsistent with zone objectives (a), (b), (g) and (h).

In Mr Nash's opinion, the introduction of a basement car park exit at the western end of the development (86 Parramatta Road) exiting onto Sparkes Street will affect the apartments on the western end of 23-27 Sparkes Street, when compared to the existing situation with cars exiting onto Sparkes Street from the basement entry/exit at 82 Parramatta Road. Mr Perica disagreed with Mr Nash and concluded that the proposal (as amended) is consistent with the zone objectives.

Findings

The objectives of the Mixed Use zone, relevant to this proposal, are:

(a) to allow, in appropriate circumstances, a mixture of compatible land uses such a residential, retail, commercial, light-industrial and industrial development, and

(b) to promote mixed use planning by locating mutually supportive and compatible uses such as residential uses, places of employment and retail uses in close proximity to each other so as to minimise vehicular travel, and

(c) to permit appropriate forms of residential development within the zone to mutually support the vitality of nearby commercial and urban village centres, and in doing so, assist successful urban consolidation, and

(d) to incorporate contemporary urban design principles in the design of new buildings and the interpretation of their relationship with the public domain, and

(g) to minimise any adverse impact on residential amenity by devising appropriate design assessment criteria and applying specified impact mitigation requirements by the use of development control plans, and

(h) to ensure that the nuisance generated by non-residential development, such as that related to operating hours, noise, loss of privacy, vehicular and pedestrian traffic or other factors, is controlled so as to preserve the quality of life for residents in the area.

Clause 10 of LEP 1998 provides a threshold test. If the development is not consistent with the relevant zone objectives, the application must be refused. If consistent, the merits of the proposal can be examined and approval granted if the merits are acceptable. Conversely, if the merits are not acceptable, the application should be refused.

The decision of Pearlman CJ in Schaffer Corporation v Hawkesbury City Council (1992) 77 LGRA 21 (Schaffer) considered the meaning of consistent in relation to zone objectives. In Schaffer, her Honour expressed the following opinion (par 27):

The guiding principle, then, is that a development will be generally consistent with the objectives, if it is not antipathetic to them. It is not necessary to show that the development promotes or is ancillary to those objectives, nor even that it is compatible.

The relevant objectives can be summarised as providing the opportunity for a mix of land uses, in appropriate circumstances, to minimise vehicular travel and to assist urban consolidation, providing that any adverse impacts on residential amenity are minimised and any potential nuisances are controlled, so as to preserve the quality of life for residents.

For reasons set out later in the judgment, I am satisfied that the proposal is consistent with the zone objectives because:

The amended plans, which provide for alternative access arrangements, minimise potential impacts on residents;
The agreed position of the acoustic experts was that any noise impacts would not warrant the refusal of the application, as they represent an improvement when compared to the existing situation, on the basis that total vehicle numbers during the night will be reduced;
The evidence regarding existing anti-social behaviour does not suggest that the proposed development will create unacceptable levels of anti-social behaviour;
The presence of security staff will minimise any anti-social behaviour;
There was agreement by the traffic experts that adequate car parking is available and that the additional traffic would not be a reason to refuse the application.

I am satisfied that the proposed sex premises, managed in accordance with the Plan of Management, will be consistent with the relevant zone objectives, pursuant to clause 10 of LEP 1998.

Location of the sex premises adjacent to a residential flat building

Evidence

The planning experts agree that the residential flat building at 23-27 Sparkes Street postdates the sex premises and they agree that in granting consent to the residential development, the Council considered the residential flat building to be compatible with the existing sex premises, notwithstanding that it did not comply with clause 3.1.2(1) of DCP 2006.

Mr Tomasetti SC submits that the residential flat building at 23-27 Sparkes Street was designed to locate bedrooms along the southern elevation, directly opposite the sex premises, to maintain privacy between the new development and the existing sex premises, as the main living areas are oriented either east or west. Entry to the residential flat building is from either Sparkes Street or Larkin Street to the lift lobby and the entries are not opposite the entry to the sex premises in Larkin Street.

The conditions of the development consent (D/2010/772) for the residential flat building at 23-27 Sparkes Street included, at condition 79, a requirement for acoustic mitigation measures to be incorporated into the building design of the residential flat building, as follows:

The development must be designed and constructed to satisfy the requirements of the Central Sydney DCP acoustic privacy requirements. A report prepared by a suitably qualified acoustic professional must be prepared and submitted to the certifying authority prior to the issue of a Construction Certificate, and must be suitably referenced in the Construction Certificate documentation.

The report must: -

(a) quantify the level of impact (noise at the exposed facades) from the normal noise of the area on the development;

(b) identify acoustic mitigation measures to be incorporated into the building design to ensure compliance with the design goals contained within the Central Sydney DCP;

(c) The Certifying Authority (PCA) must ensure that the acoustic mitigation measures identified in the subject report are suitably incorporated into the development as erected prior to the issue of an Occupation Certificate.

In Mr Nash's opinion, the entry to the residential flat building at 23-27 Sparkes Street from Sparkes Street, currently opposite the vacant lot, will be opposite the expanded sex premises, which would be unacceptable.

The planning experts disagree whether the proposal complies with clause 3.1.2(1) of DCP 2006. In Mr Nash's opinion, the proposal fails to satisfy the location provision, requiring sex premises to be separated from land developed for residential purposes by at least one other non-residential land use.

Findings

I agree with the planning experts that Council's own assessment must have concluded that the residential flat building at 23-27 Sparkes Street and the existing sex premises were compatible, despite being located directly opposite each other and clause 3.1.2(1) of DCP 2006 requiring sex industry premises not to be located immediately adjacent to or directly opposite (any elevation) of land developed for residential purposes.

The question is therefore, does the expanded sex premises remain compatible, when compared to the existing sex premises, in terms of its proximity to the residential flat building under construction at 23-27 Sparkes Street. The answer, in my view, is yes for the following reasons.

The entry to the residential flat building from Sparkes Street is opposite the south-western corner of 84 Parramatta Road. I disagree with Mr Nash that the Sparkes Street entry to the residential flat building will be affected by the proposal, as the entry to the expanded sex premises will remain in Larkin Street, out of view of the Sparkes Street entry to the residential flat building. The location of the pedestrian exits to Parramatta Road are an improvement, when compared to patrons currently exiting onto Sparkes Street, in close proximity to the Sparkes Street entry to the residential flat building.

I accept that a reasonable level of amenity within the bedrooms of the residential flat building at 23-27 Sparkes Street, adjacent to the southern elevation, will be provided by the acoustic mitigation treatment of those bedroom windows, coupled with the proper management of the sex premises.

The relevant objectives of DCP 2006 are to ensure that the design and location of adult entertainment and sex industry premises will minimise any adverse impacts on the character or amenity of the area or neighbouring properties. I am satisfied that the proposed expansion of the existing sex premises minimises adverse impacts on residential amenity by applying constraints to the management of the premises, so as to ensure that activity is focused on Parramatta Road and the amenity of residents in Sparkes and Larkin Streets is preserved.

Acoustic

Both acoustic experts reported observing patrons arriving and leaving the premises quietly and security staff assisting patrons with parking and access during their observations of the site. Dr Tonin noted that noise from traffic on Parramatta Road is audible at all the residential flat buildings in proximity of the site.

The acoustic experts agree on the following:

The acoustic issues associated with the proposal are confined to sleep disturbances from motor vehicles in Sparkes Street during the night and noise emitted by plant, such as air conditioning.
Restricting the use of the basement parking area to patrons between 10pm and 7am, 7 days a week (allowing patrons who have parked in the basement car park before 10pm to egress at any time) would result in an improvement to the existing noise levels generated during those hours, as vehicle numbers will be less than at present (assuming patrons are prevented from driving up and down Sparkes Street looking for parking during the night and taxis are confined to picking up patrons from Parramatta Road).
Requiring patrons to exit to Parramatta Road will be an improvement on the current arrangement where patrons exit to Sparkes Street.
The existing metal drain cover at the top of the ramp into the basement should be bolted down and the same should be done to the drain cover on the proposed exit ramp from the basement. Mr Gross added that signage should be included within the basement car park to remind patrons and staff to depart quietly.
A condition of consent should be included to limit noise emitted by plant to a maximum of 45dB(A) and a correction of 5dB(A).

Following the amendment of the proposal during the proceedings, there were no disputed issues between the acoustic experts.

Traffic/Parking

Evidence

The traffic experts and a traffic consultant engaged by the applicant carried out surveys of cars coming to and from the site and evidence was provided in regard to numbers of cars, times and frequency of movements. According to the vehicle count, which did not distinguish between staff and patrons, there are presently 15-20 car movements in Sparkes Street west between 10pm and 7am. Mr Hallam observed the marketing information on the website of the sex premises, in order to determine how many sex workers were available between 10pm and 7am on the Friday night prior to the proceedings. According to Mr Hallam, four staff arrived and 21 staff departed the premises during the 10pm to 7am period. According to Mr Pindar, 20% of staff arrive by car and this would result in 8 car movements in Sparkes Street west, during the night, for the proposed expansion.

Following the agreement of the parties to amend the proposal to close the basement car park between 10pm and 7am to patrons, the traffic experts agree on the following:

The closure of the car park overnight will result in less cars using Sparkes Street when compared to the present level of traffic during the same period.
It is valid to close the basement car park to patrons during the night in order to protect the amenity of residents in the vicinity of the site.
There will be sufficient on-street parking available along the northern side of Parramatta Road between 10pm and 6am, during the period that the basement car park is to be closed to patrons, as Parramatta Road is not a clearway during those hours and the bus lane starts at 6am. According to Mr Pindar, there will be a minimum of 35 car spaces available on the northern side of Parramatta Road, which is twice the number that the proposal requires, and 3 spaces available at the southern end of Larkin Street. By 6am, there is significantly less demand for parking by patrons of the sex premises.
Patrons coming to the premises from the north, and familiar with the location of the sex premises, will most likely use Arundel Street and Sparkes Street (east of Larkin Street) to access the premises.
The residential flat building at 23-27 Sparkes Street will not be affected by headlight glare from cars exiting the basement car park during the night as there is a wall opposite the car park exit ramp and the apartment floor level is above the road level.
Signage should be provided on the building in Larkin Street to inform patrons that there is no parking available in the basement car park between 10pm and 7am.

The traffic experts disagree whether closing the basement car park during peak times meets the objectives of DCP 11. According to Mr Hallam, the need to close the basement carpark during peak trading demonstrates that the proposal does not comply with the objectives of DCP 11. According to Mr Pindar, DCP 11 envisages flexibility and balancing of priorities and the closure during peak trading times is consistent with the objectives of DCP 11.

Findings

The relevant objective of DCP 11, at clause 1.2, is, 'to ensure that an acceptable level of parking is provided on-site to minimise the unreasonable overflow of parking onto surrounding streets'.

I accept the evidence of the traffic experts that there will be sufficient parking for patrons on the northern side of Parramatta Road and the southern end of Larkin Street during the night, based on the assumption that the security personnel will direct patrons to Parramatta Road. Consequently, I find that the overflow of parking onto surrounding streets, including Parramatta Road, as a result of the closure of the carpark to patrons between 10pm and 7am, is reasonable.

I am satisfied that the closure of the car park to patrons during the night will result in an improvement in the noise levels currently generated during those hours by patrons parking and walking in Sparkes Street and that the amended parking regime is consistent with the relevant objectives in clause 1.2 of DCP 11.

Floor space ratio (FSR)

Evidence

The planning experts agree that the proposal exceeds the FSR control of 2:1 with an FSR of 2.7:1.

The planning experts disagree whether the proposal meets the performance criteria set out in clause 2.2, Part E of DCP 1997. According to Mr Nash, the additional floor space over and above the FSR control of 2:1 will have a detrimental impact on the character and amenity of the surrounding area by way of additional amenity impacts generated by the expanded use. In Mr Nash's opinion, the proposal should be setback on the upper storey on the northern side, fronting Sparkes Street, in a similar manner to the stepping of the existing party wall at the 82-84 Parramatta Road shared boundary.

Findings

Even though the proposal's FSR of 2.7:1 exceeds the numerical control for FSR of 2:1, the proposal satisfies the performance criteria for FSR in DCP 1997. The performance criteria are:

overshadowing and privacy
streetscape
parking and landscaping
visual impact and views
capacity of the community infrastructure and the road network to support the development

Mr Nash agrees that the proposal will not have any impact on its neighbours in terms of view loss, overshadowing and privacy. The proposal is to the south of 23-27 Sparkes Street and will not overshadow the residential flat building currently under construction. There are no windows in the elevations of the proposal, so there are no privacy issues. The planners agree that the proposal will make a positive contribution to Parramatta Road, completing the street wall and is of a height and scale that is in keeping with development along the northern side of Parramatta Road.

I observed during the site view that the adjoining building at 88-90 Parramatta Road is higher than the proposal and the buildings on the northern side of Parramatta Road consist of a range of building heights, both greater and less than the proposal. The residential flat building at 23-27 Sparkes Street is 4-5 storeys and approximately the same height as the proposal, despite being further down the hill.

I am satisfied that the proposal respects and reflects the overall built form of the area, is consistent with the built form along the northern side of Parramatta Road and does not detrimentally affect the amenity of the area.

In my view, the proposal satisfies the performance criteria for the FSR control. The Council's contention, that the additional floor space over and above the FSR control of 2:1 will have a detrimental impact on the character and amenity of the surrounding area by way of additional amenity impacts generated by the expanded use, is addressed elsewhere in the judgment and was not a reason to refuse the application.

Draft LEP

Evidence

The planning experts agree on the following in relation to the draft LEP:

That were the proposal being assessed under the provisions of the draft LEP, the site would be zoned B4 Mixed Use and would be permissible with consent.
Under the provisions of the draft LEP, a maximum FSR of 2.5:1 and height of 18m is permitted for the site and the proposal would result in a FSR of 2.35:1 when calculated in accordance with the definition of floor space in the draft LEP and is a height of approximately 12.5m at the south eastern corner measured from the footpath level to the top of the parapet.

The experts disagree as to the weight the Court should give the calculation of FSR under the draft LEP, on the basis of whether the draft LEP is certain and imminent or not. Evidence was provided by both parties as to the certainty and imminence of the draft LEP; the applicant stating that the draft LEP is certain and imminent as it has been referred to the Department of Planning and Infrastructure with a request that the Minister make the Plan and the Council stating that it is impossible to predict when the draft LEP will be gazetted as the Department has not prepared its report to the Minister.

The evidence tendered by the applicant is that the draft LEP was exhibited from 2 February 2011 to 4 April 2011 (Exhibit P). Following the 2011 public exhibition, a report on public submissions on the draft LEP was presented to the Central Sydney Planning Committee (CSPC) and Council. On Thursday 8 March 2012 (Exhibit N) and Monday 12 March 2012 (Exhibit O) the CSPC and Council approved the draft LEP for referral to the Department of Planning and Infrastructure with a request that the Minister make the Plan.

Findings

Pursuant to s 79C(1)(a) of the EPA Act, the following must be considered in terms of the draft LEP:

(ii) any proposed instrument that is or has been the subject of public consultation under this Act and that has been notified to the consent authority (unless the Director-General has notified the consent authority that the making of the proposed instrument has been deferred indefinitely or has not been approved)

The weight to be attributed to a draft environmental planning instrument will be greater if there is a greater certainty that it will be adopted. Relevantly, Spigelman CJ states, at par 5 of Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) NSWCA 289, the following:

Mason P outlines the line of authority in the Land and Environment Court to the effect that the weight to be given to a draft environmental planning instrument will be greater after such an instrument has been gazetted on the basis of its "certainty and imminence". I agree with the proposition that the greater the certainty that a draft instrument will in fact be adopted, the greater the weight that may be given to that draft.

The question of whether or not the draft LEP is certain and imminent is not fundamental to the proposal before the Court, as it will likely remain permissible, with consent, under the provisions of the new LEP. I accept the evidence of the applicant that the draft LEP has a high level of certainty, on the basis that the Council has referred it to the Department of Planning and Infrastructure. The question of its imminence is less important, in this case.

As the draft LEP has a high level of certainty, I give weight to the fact that the proposal would comply with the FSR control of 2.5:1 under the draft LEP.

As the proposed addition to the draft LEP, clause 7.25 (Exhibit 13) has not been publicly exhibited by Council and is neither certain, nor imminent, I have given it no weight.

Security Personnel

Evidence

The number of security guards during peak times is disputed by the parties, with the applicant's planning experts suggesting two security guards are required between 9pm and 5am, Thursday to Sunday nights and the respondent's planning expert suggesting 4 security guards are required between 7pm and 7am, Thursday to Sunday nights.

Findings

In my view, the increase in the number of security guards should coincide with the closure of the basement parking to patrons, so that a security guard is available to inform and direct patrons driving to the premises and inform patrons coming from the north, via Arundel Street and Sparkes Street east, to turn left into Larkin Street and left again onto Parramatta Road and to park on Parramatta Road. Therefore, the increase in security guards should commence at 9pm, 1 hour prior to the closure of the basement parking in order to manage the transition from basement parking being available for patrons to patrons being excluded from the basement parking and should conclude at 7am, when the basement parking again becomes available to patrons.

I find, in relation to the dispute as to whether two or four guards are required at peak times, that the number of security guards during the peak hours of operation must be a balance between the need for a security presence and the amenity of the residents in the vicinity of the premises. A security guard should be located on the corner of Sparkes and Larkin Street to deal with patrons arriving by car from Sparkes Street east and on busy nights and two security guards should be located on the Parramatta Road frontage to hail taxis for departing patrons and provide a secure entry/exit to the sex workers from the Escort Agency. I am satisfied that this is a reasonable balance between the need to ensure the smooth operation of the sex premises with the residents' requirement not to have an intrusive security presence in Larkin and Sparkes Streets.

Art installation Parramatta Road ground floor elevation

Evidence

The parties disagree as to whether a retail tenancy fronting Parramatta Road should be included in the proposal. The Council contends that a retail premises should be included in the proposal and the applicant has deleted the retail tenancy in the amended ground floor plan (exhibit G) and replaced it with a proposed art installation.

The planning experts agree that Parramatta Road at Camperdown is not a vibrant shopping strip and would not be an attractive location for a café. They agree that an empty retail tenancy would be the worst outcome.

Mr Nash contends that the retail tenancy proposed prior to its deletion is inadequate and to be viable, it would require a connection to the basement for deliveries and a greater depth for the retail area. In Mr Nash's opinion, either the retail (with a larger floor space and basement connection) or the art installation would be acceptable, as the purpose is to activate the street elevation.

Findings

I accept Mr Nash's evidence that the shallow area originally proposed for a retail tenancy, without a connection to the basement, would not be commercially viable and would likely remain vacant. I accept the evidence of the planning experts that the worst outcome for the Parramatta Road ground floor elevation would be an empty retail tenancy and that the proposed art installation is an acceptable solution to add vibrancy to the street front.

As the concept for the proposed art installation was tendered during the proceedings, without an assessment of the proposal by Council or Council's experts, details of the art installation proposal are to be submitted to Council and approved prior to the issue of the Construction Certificate or to be the subject of a separate development application.

Signage

Evidence

The parties disagree as to whether the consent should include the proposed illuminated wall panel sign on the eastern elevation of 84-86 Parramatta Road, above the existing building at 82 Parramatta Road and an under-awning sign on the Parramatta Road elevation.

According to Mr Nash, the two signs should be deleted because of the accumulative effect of the proposed additional signage.

Findings

I find that the additional proposed external identification, including the illuminated wall panel sign and the under-awning sign should be deleted, so that the building's presence remains discrete, due to its proximity to residential flat buildings and the University of Sydney.

Non-compliances regarding staffing numbers

Mr Nash states that staff numbers at peak times have been in excess of the current consent for the sex premises of a maximum of 25 staff. Past activities is not a relevant factor in determining whether consent should be granted or not. This approach is consistent with Jonah Pty Limited v Pittwater Council [2006] NSWLEC 99, where Preston CJ confirmed that the obligation of the Court is to be concerned only with the prospective impacts of a proposed land use, as the consent runs with the land. Relevantly, he states (par 35):

In undertaking the merit determination of whether to grant or modify a development consent, it is irrelevant to enquire as to who is the current owner/operator, or who might be the future owner/operator, or whether the present owner/operator has in the past acted or used the land unlawfully, or whether the future owner/operator is likely in the future to act or carry out any approved use unlawfully.

As the assumptions of the traffic, acoustic and planning experts are based on a maximum of 50 staff at the premises at any time, a limit of a maximum of 50 staff on the premises, not including security staff, is imposed on the consent. Adherence to the constraints imposed on the consent to minimise any adverse impacts on residential amenity is essential, so as to preserve the quality of life for the residents in the area.

Conclusion

DCP 2006 does not provide guidelines on a maximum capacity for a brothel or the expansion of a brothel. In the absence of guidelines, the current operation for the brothel has been taken into account and according to the Council's staff report to the Lord Mayor and Councillors regarding D/2011/566 dated 19 September 2011 (Exhibit 3 tab1), which took into account Council records and NSW Police comments, the operation of 'Stiletto' has been acceptable and better than most [brothels].

The issue of a moral objection to the nature of the activities of a sex premises were raised by some of the public submissions and resident objectors. As a sex premises is a legal land use and permissible in the Mixed Use zone with consent, moral objections to the proposal are not relevant considerations. The role of the Court is confined to a merits assessment of the proposal on the basis of its impacts on the amenity of the neighbourhood.

In reaching my conclusion, I have given weight to the fact the proposal will continue to be permissible with consent and that it will not undermine the objectives of the B4 Mixed Use Zone, under the Draft LEP (as per Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) NSWCA 289 at par 7).

The constraints imposed on the proposal have sought to manage potential traffic and noise impacts on residential amenity, by focusing the activity on Parramatta Road, so as to lessen the amenity impacts on the residents in Sparkes and Larkin Streets when compared to the existing impacts of the premises. The built form of the proposal is consistent with the streetscape.

Interim findings - Maximum patron numbers

Interim findings were handed down on 25 May 2012 that required submissions from the parties regarding a proposed condition by the Court to restrict patron capacity to a maximum number on the premises at any one time. The parties provided separate written submissions on 7 June 2012 and the applicant provided a written submission in reply on 8 June 2012.

The applicant contends no condition limiting the number of persons on site on the basis that the natural limits of the proposal and the Building Code of Australia (BCA) covers the concern and it is just another management burden that, if imposed, needs to be complied with. If a condition is to be imposed limiting the number of patrons, the applicant seeks a condition limiting the maximum number of people on the site at any one time to 160 persons (including staff and excluding security personnel).

The parties agree that the maximum number of sex workers will be 40, taking into account the staff numbers provided in the Plan of Management.

The Council contends that the maximum number of persons (excluding staff and contractors) permitted in the premises at any one time should be 60 persons, on the basis that the number of patrons is proportionate to the number of sex workers and not the number of rooms, as a patron is serviced by the sex worker and this determines how many patrons can be serviced, rather than the number of rooms. Allowing for an overlap of time between patrons arriving and leaving, the Council has used a multiplier of 1.5 patrons to 40 sex workers, in order to derive the maximum number 60 patrons. The Council contends that it should be the role of the Floor Manager to ensure that the number of persons (excluding staff and security personnel) in the premises does not exceed 60 and a record of persons entering and leaving is to be kept by the Door Manager and the record produced for inspection, upon request, by an employee of Council.

I agree with the Council that the maximum number of patrons on the premises at any one time is relative to the maximum number of sex workers on the premises and I accept the Council's reasoning of a multiplier of 1.5 patrons to sex workers, allowing for an overlap of time between patrons arriving and others leaving. I am satisfied that the maximum number of patrons (excluding staff and security personnel) that should be permitted in the premises at any one time is 60 persons and the Floor Manager should be responsible for ensuring that the number of persons in the premises does not exceed this maximum amount.

Orders

The orders of the Court are:

1. The appeal is upheld.

2. Development Application No D/2011/566 for an extension of an existing sex premises is approved subject to the conditions in Annexure A and the Plan of Management in Annexure B.

3. The exhibits are returned except for exhibits 1, 8, 9, 10, A and J.

Susan O'Neill

Commissioner of the Court

ANNEXURE A

ANNEXURE B

**********

Decision last updated: 18 June 2012

Actions

Download as PDF Download as Word Document

Citations

Artazan Property Group P/L v City of Sydney Council [2012] NSWLEC 1164

Cases Citing This Decision

0

Cases Cited

1

Statutory Material Cited

2

Jonah Pty Limited v Pittwater Council [2006] NSWLEC 99

Medium Neutral Citation:	Artazan Property Group P/L v City of Sydney Council [2012] NSWLEC 1164
Hearing dates:	16-18 April 2012
Decision date:	18 June 2012
Jurisdiction:	Class 1
Before:	O'Neill C
Decision:	1. The appeal is upheld. 2. Development Application No D/2011/566 for an extension of an existing sex premises is approved subject to the conditions in Annexure A and the Plan of Management in Annexure B. 3. The exhibits are returned except for exhibits 1, 8, 9, 10, A and J.
Catchwords:	DEVELOPMENT APPLICATION: extension of existing brothel, appropriateness of location, FSR, parking and traffic impacts and the public interest and weight to be given to the draft LEP.
Legislation Cited:	Environmental Planning and Assessment Act 1979 Land and Environment Court Act 1979
Cases Cited:	AJA Trading Pty Ltd v Waverley Council [2005] NSWLEC 253 Jonah Pty Limited v Pittwater Council [2006] NSWLEC 99 ROI Properties Pty Ltd v Council of the City of Sydney [2001] NSWLEC 1023 Schaffer Corporation v Hawkesbury City Council (1992) 77 LGRA 21 Terrace Tower Holdings Pty Ltd v Sutherland Shire Council (2003) NSWCA 289
Category:	Principal judgment
Parties:	Artazan Property Group (Applicant) Sydney City Council (Respondent)
Representation:	Counsel Mr Peter Tomasetti SC (Applicant) Ms Sandra Duggan SC (Respondent) Solicitors Henry Davis York (Applicant) City of Sydney Council (Respondent)
File Number(s):	10946 of 2011