Australand Holdings Limited v Hornsby Shire Council [1998] Nswlec 42 (20 March 1998)

[1998] NSWLEC 42

Land and Environment Court

of New South Wales

CITATION:	AUSTRALAND HOLDINGS LIMITED v HORNSBY SHIRE COUNCIL [1998] NSWLEC 42 (20 March 1998) [1998] NSWLEC 16
PARTIES:	AUSTRALAND HOLDINGS LIMITED v HORNSBY SHIRE COUNCIL [1998] NSWLEC 42 (20 March 1998)
FILE NUMBER(S):	10009 of 1998
CORAM:	Bignold J
KEY ISSUES:	:-
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979, ss91AA, 97(1),(1A) and 102 Liqour Act
CASES CITED:	Liverpool Borough Bank v Turner (1860) 2 De GF & J 502 at 507 ; Hatton v Beaumont (1977) 2 NSWLR 211 at 214.; Woods v Bate (1987) 7 NSWLR 560 at 567 ; R v Ingall (1876) 2 QBD 199 at 208; Caldow v Pixell (1877) 2 CPD 562 at 566 ; Clayton v Heffron (1960) 105 CLR 214 at 247; in Botany Bay City Council v Galeb Kilzi & Anor (unreported 17 March 1997); Johnson v Lake Macquarie City Council (1996) 91 LGERA 331; Adelaide Pistol Club Inc v District Council of Munno Para (1981) 45 LGRA 119; Morris v Gosford City Council (unreported 29 November 1996); Cameron v Nambucca Shire Council (unreported 8 August 1997) ; Swadling v Sutherland Shire Council (1994) 82 LGERA 431 ; Bowyer v Manly Council ; Smith v Bellingen Shire Council (unreported 26 August 1997); in Peter Dallow v Wagga Wagga City Council (unreported 6 February 1997)
DATES OF HEARING:	9 March 1998 11,13 & 17 March 1998 - further written submissions
DATE OF JUDGMENT:	03/20/1998
LEGAL REPRESENTATIVES:	Mr G Cummins Mr M Connell

JUDGMENT:

A. Introduction

The parties to pending class one proceedings have asked the Court to determine a number of legal questions in dispute, in advance of any determination on the planning merits of the case. The proceedings involve an appeal pursuant to s102(5) of the Environmental Planning and Assessment Act 1979 (the EP&A Act) against the Council’s refusal to approve the Applicant’s modification application. The Council’s decision apparently was based upon its opinion that it lacked the power to modify the relevant development commencement consent which in its opinion was an inoperative, and hence not a subsisting, development consent.

In the course of the hearing the Applicant, without objection from the Council, sought and obtained leave to amend the current proceedings to include two alternative appeals (one being provisional) namely - (i) an appeal pursuant to s97(1A) of the EP&A Act against the Council’s deemed notice of not being satisfied as to the matter the subject of the deferred commencement consent, and (ii) an appeal pursuant to s97(1) of the EP&A Act against the Council’s determination granting the deferred commencement consent. On 10 March 1998 the Applicant filed an amended application to include the appeal pursuant to s97(1A) and on 11 March 1998 the Applicant filed a Notice of Motion in respect of the provisional appeal pursuant to s97(1).

Five separate questions have been raised by the parties and at the hearing a sixth question has, by consent, been raised and the parties have availed themselves of the opportunity to address additional argument on this additional question. The terms of the six questions are set out in the Annexure hereto.

I should at once acknowledge the comprehensiveness of the competing legal arguments that have considerably helped me to determine the interesting and difficult questions posed.

Although I shall answer each of these questions it is possible to say at the outset that the proceedings raise the following question:

Whether a deferred commencement consent granted pursuant to s91AA of the EP&A Act is legally capable of being (i) modified pursuant to s102 of the EP&A Act and/or (ii) reviewed by way of appeal pursuant to s97(1) and/or (1A) of the EP&A Act in circumstances where the applicant has not produced evidence to satisfy the consent authority of the matter, the subject of the deferred commencement condition, within the period specified by the consent authority in accordance with s91AA(4) of the EP&A Act ?

I have been able to formulate the question in this generalised form because it perfectly accords with the facts as outlined in the statement of agreed facts (Exhibit 1), and so formulated brings into sharpest focus the fundamental question of principle raised by the proceedings.

It is only necessary to extract the following facts from that statement:
(i) By Notice dated 26 March 1997 the Council notified the Applicant that deferred commencement consent had been granted pursuant to s91AA of the EP&A Act subject to a number of specified conditions in respect of its development application for the creation of a 19 lot residential subdivision at Dural.
(ii) Of the aforesaid conditions Condition 1 was in the following terms:


“ 1. This consent shall have no force or effect until the following information is submitted:


1.1 The location of the relics referred to in the “Heritage Assessment - Elouera Estate relics” being identified on site and on a plan prepared by a Registered Surveyor and confirmed by the Heritage Consultant or an archaeologist.


1.2 The applicant providing relevant information to satisfy the Council’s General Manager that the proposed development will not significantly impact on the identified relic having regard to the recommendation of the report - “Heritage Assessment - Elouera Estate relics”, dated November, 1996.


1.3 The applicant seeking a Notice of Discontinuance in the Land and Environment Court in respect of this matter.


Such information shall be submitted within 3 months of the date of this approval.”

(iii) The other Conditions (namely conditions 2 to 47 inclusive) were stipulated to apply “ on receipt of the above information …” (They are not relevant for present purposes.)
(iv) The aforesaid written Notice contains the following endorsement:

“Endorsement of date of development consent and subdivision approval 26 March 1997.”

(v) On 26 August 1997 the Applicant submitted to the Council information apparently answering the description of the information required in condition 1.1 and condition 1.2 of the deferred commencement consent. (The requirement of condition 1.3 apparently was satisfied by the Applicant filing a Notice of Discontinuance (with the Council’s consent endorsed thereon) in proceedings in this Court numbered 30168 of 1996). The information was so submitted to the Council some 2 months outside the period of 3 months that had been stipulated in the deferred commencement consent (condition 1).

B. The relevant provisions of the EP&A Act

In order to answer the disputed questions of law it is necessary to note a number of the provisions contained in Division 1 of Part 4 of the EP&A Act (“Environmental Planning Control”) which provide the statutory code in respect of “development consents”.
(i) Section 77 provides for the making of a “development application for consent to carry out development”.
(ii) Section 90 specifies the matters of relevance to the development application which the consent authority is bound to consider.
(iii) Section 91 provides for the determination of a development application by (a) granting consent (either unconditionally or subject to conditions) or (b) refusing consent. Subsection (3) relevantly provides:

A condition may be imposed for for the purposes of subsection (1) if it:

“(h) is authorised to be imposed under s91AA…”

(iv) Section 91AA must be quoted in its entirety. It provides:

“(1) A development consent may be granted subject to a condition that the consent is not to operate until the applicant satisfies the consent authority as to any matter specified in the condition. Nothing in this Act prevents a person from doing such things as may be necessary to comply with the condition.


(2) Such a consent must be clearly identified as a "deferred commencement" consent (whether by the use of that expression or by reference to this section or otherwise).


(3) A "deferred commencement" consent must clearly distinguish conditions concerning matters as to which the consent authority must be satisfied before the consent can operate from any other conditions.


(4) A consent authority may specify the period in which the applicant must produce evidence to the consent authority sufficient to enable it to be satisfied as to those matters.


(5) The applicant may produce evidence to the consent authority sufficient to enable it to be satisfied as to those matters and, if the consent authority has specified a period for the purpose, the evidence must be produced within that period.


(6) If the applicant produces evidence in accordance with this section, the consent authority must notify the applicant whether or not it is satisfied as to the relevant matters. If the consent authority has not notified the applicant within the period of 28 days after the applicant's evidence is produced to it, the consent authority is, for the purposes only of section 97, taken to have notified the applicant that it is not satisfied as to those matters on the date on which that period expires.

(v) Section 92 requires the consent authority to give written notice of its determination of a development application. Subsection (3) provides as follows:

“(3) In the case of a development consent granted subject to a condition that the consent is not to operate until the applicant satisfies the consent authority as to any matter specified in the condition:


(a) the date from which the consent operates must not be endorsed on the notice, and


(b) if the applicant satisfies the consent authority as to the matter, the consent authority must give notice to the applicant, in the prescribed form and manner, of the date from which the consent operates.”

(vi) Section 93 provides for the date upon which a development consent becomes operative. Generally that date is the date endorsed upon the s92 Notice. However where the development consent is the subject of an appeal to this Court pursuant to s97 or s98 the consent “shall cease to be, or shall not become effective” pursuant to subsection (1) and shall become effective from the date of the decision on that appeal, ( subsection (2) ) except where the effect of the appeal is the refusal of development consent ( subsection (3) ).
(viii) Section 97 provides for appeals to this Court in respect of the consent authority’s determination of a development application, subsection (1) providing for an appeal by an applicant “who is dissatisfied with the determination…” and subsection (1A) providing as follows:

“(1A) An applicant who is dissatisfied with a decision that a consent authority is not satisfied as to a matter, being a matter as to which it must be satisfied before a "deferred commencement" consent under section 91AA can operate, may appeal to the Court within 12 months after the consent authority notifies the applicant of its decision.”
(ix) Section 99 provides for the lapsing of a development consent. Generally speaking a consent will lapse unless building, engineering or construction work is physically commenced on the land to which the consent applies before the expiration of 5 years from the date upon which the consent becomes operative ( subsections (1) and (4) ).
(x) Section 102 provides for the modification of a development consent subsection (4) providing as follows:

“(4) Modification of a development consent in accordance with this section shall not be construed as the granting of development consent under this Division but a reference in this or any other Act to a development consent shall be a reference to the development consent so modified.”
(xi) Section 103 provides for the revocation of a development consent.

From these statutory provisions I think that the following propositions may be readily deduced (unassisted by any judicial exposition of the provisions) of relevance to a deferred commencement consent :
(i) a deferred commencement consent may be granted to a development application by the combined operation of ss 91(1)(a) and (3)(h) and 91AA ;
(ii) a deferred commencement consent is a development consent that imposes a condition that “the consent is not to operate until the applicant satisfies the consent authority as to any matter specified in the condition”: s91AA(1) ;
(iii) a deferred commencement condition must be clearly identified as such and must clearly distinguish between conditions relevant to the deferred commencement (deferred commencement conditions) and conditions not so relevant: s91AA(2) and (3) ;
(iv) the consent authority may specify the period in which the applicant must produce evidence to satisfy the deferred commencement conditions: s91AA(4) ;
(v) where the consent authority has specified a period in terms of subsection (4) the evidence “must be produced within that period”: s91AA(5) ;
(vi) where the applicant satisfies the consent authority of the matter the subject of the deferred commencement condition, the consent authority must give to the applicant prescribed notice of the date from which the consent operates: s92(3) ;
(vii) upon giving the prescribed notice under s92(3) the deferred commencement consent becomes effective and operative: s93(1) (subject to any appeal, in which case the consent becomes effective upon the date of the decision on that appeal s93(2)(b) except when the result of the appeal is the refusal of development consent in which case the consent is deemed never to have been granted: ( s93(3) );
(viii) a deferred commencement consent is susceptible to the statutory appeal processes: s97(1) and s98(1) ;
(ix) a deferred commencement consent is susceptible to statutory lapsing: s99 ;
(x) a deferred commencement consent is susceptible to statutory modification: s102 ;
(xi) a deferred commencement consent is susceptible to statutory revocation: s103
(xii) a decision by the consent authority that it is not satisfied as to a matter, the subject of a deferred commencement condition, is liable to appeal: s97(1A) ; and
(xiii) a failure by the consent authority to notify the applicant within 28 days after the applicant’s production of evidence as to the matter the subject of the deferred commencement condition is deemed, for the purposes of s97, to be a decision that the consent authority is not satisfied: s91AA(6) .

Although these propositions apply to a deferred development consent they so apply, in the main, because a deferred commencement consent is a species of the genus comprising a development consent.

It should at once be noted that none of the foregoing propositions supports the Council’s contention that non-compliance with the time stipulation causes the deferred commencement consent to lapse. This of course is not decisive but merely reflects the fact that the EP&A Act contains no express provision to that effect. However the Council’s argument depends upon the implication that it claims to necessarily arise from express statutory provisions.

In deducing these propositions I have been content to merely focus upon the statutory language and apply conventional principles of statutory interpretation. For this reason they must, at least for the moment, be regarded as merely tentative and provisional. They may need to be refined (or indeed, abandoned) in the process of critically examining the competing arguments advanced in this case and in considering the impact of the decided cases. However in respect of the last mentioned factor the case has been presented on the basis that the fundamental question raised has not hitherto been the subject of direct judicial decision.

C. The Competing Arguments

The Council’s argument is that the legal effect of the Applicant’s failure to produce the required evidence within the 3 month period stipulated by the Council was to cause the deferred commencement consent to lapse, and for that reason it is not legally susceptible to statutory review under s97 of the EP&A Act or statutory modification under s102 of the EP&A Act.

The Council’s argument is principally founded upon the statutory language and particularly the imperative form employed by s91AA(5): “…the evidence must be produced within that period”.

It seeks to bolster its argument by considerations of public policy, namely that unless the consent authority had the power to impose the time stipulation for the production of the required evidence and unless compliance with any time stipulation were strictly observed and enforced, uncertainty would bedevil the status of a deferred commencement consent and such uncertainty is contrary to the express objects of the Act: vide s5(a)(i) and (ii) and (c).

However there are obvious difficulties with the Council’s argument. In respect of its primary submission, based upon the statutory language, the obvious difficulty is that s91AA simply does not provide for the lapsing of the deferred commencement consent as the legal consequence of the Applicant’s failure to comply with the relevant time stipulation. Accordingly in the absence of express provision the Council’s argument depends upon the necessary legal implication being drawn from the statutory language. The only suggested justification for such an implication being drawn is that without it, serious uncertainty would be created concerning the status of a deferred commencement consent immediately upon the expiry, unfulfilled, of the time stipulation given pursuant of s91AA(4).

However difficulties with this submission arise from the fact that (i) the power to impose a time stipulation is permissive, not mandatory, and accordingly there may be many deferred commencement consents which are not subject to any time stipulation and therefore may linger indefinitely and (ii) the sought after certainty is apt to prove elusive even in a case where there is an unfulfilled time stipulation, in as much as it has not been explained how it is to be declared, and generally be known, that the consent has lapsed. Without appropriate mechanisms for declaring the lapse of the consent, there is likely to be as much or more uncertainty created by the automatic lapsing than would be the case without it.

In its further written submissions the Council added the further argument that the time stipulation had the effect of converting the relevant condition into a condition precedent and that the failure of that condition precedent meant that the deferred commencement consent must itself fail. This limb of the Council’s argument seeks to bring the statutory language within the established legal doctrine of condition precedent or condition subsequent or defeasible conditions. Alternatively it is founded on the notion of “implied nullification for disobedience” (with the statutory requirement) per Lord Campbell LC in Liverpool Borough Bank v Turner (1860) 2 De GF & J 502 at 507 cited in the judgment of Hope JA in Hatton v Beaumont (1977) 2 NSWLR 211 at 214.

The Applicant’s competing argument is founded on 3 alternate propositions ( as developed in its written submission) namely:
(i) The deferred commencement consent is legally capable of being modified pursuant to s102 of the EP&A Act because the deferred commencement consent, though it has not yet come into force, nonetheless enjoys a legal existence sufficient to invoke the statutory modification power under s102, which existence is not subject to any relevant statutory lapsing provision.
(ii) The time stipulation imposed pursuant to s91AA(4) of the EP&A Act is a directory, and not a mandatory, requirement and hence may be satisfied by substantial, as opposed to strict, compliance.
(iii) The Court is vested with a discretion to grant the Applicant relief against the consequences of its non-compliance with the time stipulation.

There are truly alternate arguments. The first proposition is premised on the deferred commencement consent surviving intact the non-fulfilment of the time stipulation. This premise is founded upon (i) the absence of express provision in s91AA(5) as to the consequences of non-compliance with time stipulation; and (ii) established principles of statutory interpretation, which positively discourage the drawing of implications from statutory provisions, which would result in the derogation of valuable rights.

The Applicant’s second proposition is founded upon familiar authority which distinguishes between statutory requirements that are mandatory and those that are directory. More often than not, the need to so distinguish statutory requirements, arises in the context of an attack upon the legal validity of an act done pursuant to a statutory provision because of a failure to comply with an antecedent condition: see Woods v Bate (1987) 7 NSWLR 560 at 567 per McHugh JA who immediately went on to say:


“Speaking generally, I think that, at the present time, the proper approach is to regard a statutory requirement, expressed in positive language, as directory unless the purpose of the provision can only be achieved by invalidating the result of any departure from it, irrespective of the circumstances or resulting injustice: cf. Hatton v Beaumont (1977) 2 NSWLR 211 at 226 per Mahoney JA”.

Although the Applicant relied upon that particular passage from the judgment of McHugh JA, it appears to me to be not directly in point to the question raised in the present case, namely whether non-compliance with the time stipulation imposed pursuant to s91AA(4) of the EP&A Act , ipso facto invalidates, or causes to lapse, the relevant deferred commencement consent (the existence of which preceded the non-compliance with the statutory requirement).

More relevant to the present case, in my respectful opinion, is the earlier statement at 556 in the judgment of McHugh JA where his Honour states:


“A statute which requires an act to be done within a time period does not necessarily invalidate the doing of that act outside the period. The purpose of the statutory requirement may be directory rather than mandatory. It depends on the terms of the enactment. If the purpose of the provision is to ensure that the act is done within the stipulated period, then the doing of the act outside the period is of no effect. If, however, the purpose of the provision is to state a direction but not an imperative requirement, then the doing of the act outside the period will not necessarily invalidate it. To determine what is the purpose of the provision, it is necessary to weigh the various consequences of a failure to comply with the statute: R v Ingal l (1876) 2 QBD 199 at 208; Caldow v Pixell (1877) 2 CPD 562 at 566 and cf Clayton v Heffron (1960) 105 CLR 214 at 247.”

Applying that passage to the present case it is to be noted that even if it were held that the time stipulation were mandatory, the act done in non-compliance with the statutory requirements, which is consequently invalidated is the production of the evidence by the Applicant and not the antecedent grant of the deferred commencement consent.

The third proposition advanced by the Applicant is said to be founded upon the approach taken by Stein J to the exercise of judicial discretion in Botany Bay City Council v Galeb Kilzi & Anor (unreported 17 March 1997). However in my judgment, such an approach is simply not available in the present proceedings which involve questions of law raised for preliminary determination in a class 1 proceeding and accordingly, unlike Kilzi, does not involve any judicial discretion as to granting or withholding declaratory relief in civil enforcement class 4 proceedings. Accordingly this argument can be immediately rejected and I do so.

Before finally adjudicating on the competing arguments which ultimately are to be resolved by the process of statutory interpretation, I shall now consider the state of the relevant case law.

D. The Decided Cases on the Relevant Provisions of the EP&A Act.

As I have earlier mentioned my examination of these cases is undertaken in quest for whatever assistance they may provide in the present case, upon the footing that the fundamental question raised in this case is not governed by existing authority.

Of the decided cases concerning s91AA of the EP&A Act, the same question as is raised in the present proceedings, was directly raised in Kilzi. However in the result Stein J did not find it necessary to determine “whether , by operation of s91AA(5), a consent lapses automatically at the expiration of the specified period if no evidence is presented to Council”: 5.

It appears that a submission asserting an affirmative answer to that question had been advanced on behalf of the Botany Bay City Council in reliance upon his Honour’s earlier decision in Johnson v Lake Macquarie City Council (1996) 91 LGERA 331.

However his Honour dealt with that submission by distinguishing Johnson when he said at 5:


“The terms of the condition in Johnson included a note forming part of the condition, which stated:


‘Council shall be advised of the full requirements of the National Parks & Wildlife Service and if necessary a license obtained with six months of the date of this consent or the consent will lapse’. (emphasis added)


The question of lapse of the consent by effluxion of time in Johnson was a matter of interpretation of the deferred commencement condition and Council’s purported satisfaction therewith, rather than a consequence a s91AA(5) of the EP&A Act. It must also be noted that my remarks on the deferred commencement condition were obiter.”

In passing I would wish to add a cautionary word against the imposition of a condition on the grant of development consent which attempts to provide for the lapsing of the consent in the event that some act does not occur within a specified time. In Johnson the relevant condition so provided, and although Stein J in his obiter holding, gave full effect to the condition, it appears that no question had been raised concerning the validity of such a condition.

That such a condition is clearly of questionable validity is well attested by a long line of authority in South Australia concerning the power of a planning authority to impose conditions on the grant of development consent. It will be sufficient to limit reference to the decision of Wells J in Adelaide Pistol Club Inc v District Council of Munno Para (1981) 45 LGRA 119 where his Honour held to be invalid (as not being authorised by the statutory power to impose conditions) the following condition:


“The consent now given will lapse and be void if the buildings and structures and engineering and site works and landscaping and planting of flora are not completed in all respects on or before 30 June 1981”.
At 123 Wells J analysed that condition as follows:

“The subject condition has, to my mind, two elements that call for consideration: the first, is the element of time incorporated into it by virtue of which a failure on the part of the owner to perform the specified works within the stated period attracts a sanction that affects the very existence of the consent to which the condition is annexed; the second, is the direction that, in the event of that failure, the condition is to operate as an automatic defeasance.”
After referring to the relevant statutory power to impose conditions on the grant of development consent Wells J expressed the following conclusion at 124:

“In my opinion, the combined effect of sub-ss (8) and (9), in their legislative context, is to exclude the power to annex to a consent a condition to the effect that, if specified works are not completed within a time set by the condition, the consent itself becomes automatically null and void. I would, therefore, direct that the 1978 consent must have effect disengaged from condition number 27, and that the consent be varied accordingly.”

In my respectful opinion, the result and reasoning in Adelaide Pistol Club are prima facie applicable to the statutory power to impose conditions conferred by s91(1) and (3) of the EP&A Act and is likewise applicable to the power sourced in ss91 and 91AA to impose a deferred commencement condition.

Of the other decided cases which have dealt with s91AA I need only note that in Morris v Gosford City Council (unreported 29 November 1996) I held at 12 that “the grant of a deferred commencement development consent is ‘the grant of a development consent’ for the purposes of the EP&A Act generally and within the meaning of s104A in particular …” and that in Cameron v Nambucca Shire Council (unreported 8 August 1997) Talbot J held at 10 that “(A) deferred commencement consent is a final consent when it is granted, even though the date from which the consent operates must not be endorsed on a notice, as required by s92(3)(a) until the applicant satisfies the consent authority as to the matters specified in the condition”.

In Johnson Stein J at 338 rejected an argument that “the deferred commencement consent was not perfected until the Council is satisfied with compliance with the deferred commencement condition”, and that accordingly the Council when considering whether it was satisfied as to the matter the subject of the deferred commencement condition, was also bound to consider the relevance of a State Environmental Planning Policy that had come into force after the date of the Council’s determination granting the deferred commencement consent.

Another decision of this Court cited in the argument is Swadling v Sutherland Shire Council (1994) 82 LGERA 431 where Talbot J considered the question whether the council had power to determine a s102 modification application in respect of a development consent which at the relevant time was the subject of a pending appeal to this Court pursuant to s97 of the EP&A Act.

In upholding the council’s power to modify the development consent pursuant to s102 of the EP&A Act while an appeal pursuant to s97 of the EP&A Act was pending in respect of that consent, his Honour made the following observation at 435:


“Although a consent ceases to be effective once an appeal is lodged, it nevertheless continues to operate. In other words it still has some life pending the decision on the appeal. Its existence continues even though it cannot be effective to allow the applicant to act on it by carrying out the subject development. That benefit, of acting on the consent, for the time being, is embargoed or suspended.


The scheme of Part 4 of the Environmental Planning and Assessment Act will not be disrupted by a council acting to modify a consent notwithstanding a pending appeal by the original applicant.”

The Applicant relies upon the decision and reasoning in Swadling as supporting the availability of the statutory modification power by likening the (i) “non-operative” effect of a deferred commencement consent (until the deferred commencement condition is satisfied) to (ii) the non-operative and non-effective function of a development consent while it is the subject of an appeal pursuant to s97 of the EP&A Act .

In Bowyer v Manly Council (unreported 28 February 1997) Talbot J, in class 4 proceedings claiming a declaration that the developer had complied with a deferred commencement condition encountered an argument advanced by the council that a failure to comply with the time stipulation produced the legal effect that the deferred development consent “cannot operate”. (This argument may not be tantamount to the consent having lapsed.)

However his Honour did not have to consider the argument because he found that the deferred commencement condition had been satisfied within the time stipulation.

A similar result occurred in Smith v Bellingen Shire Council (unreported 26 August 1997) where Talbot J (at 5) gave the following answer to a question of law whether s91AA(5) required all evidence to satisfy the consent authority of the deferred commencement condition to be provided within the stipulated time:


“…s91AA(5) requires only that the applicant produce evidence which facilitates the process whereby the Council is enabled to be satisfied. The requirement of s91AA(5) is not that the evidence produced be evidence that satisfied the council. That is the language of s91AA(6).”
His Honour’s answer is further explained by his analysis of s91AA provided at 3 where he states:

“The distinction to be drawn between the language used in subss (4) and (5) and subs (6) is that subss (4) and (5) are dealing with sufficiency of the evidence produced as a basis to facilitate the making of a determination that the consent authority is actually satisfied as to the matters specified in a condition imposed pursuant to subs (1). It is not necessary, therefore, that the evidence required by subss (4) and (5) actually satisfies the consent authority in a final, full and complete way.”

Finally I should note that in Peter Dallow v Wagga Wagga City Council (unreported 6 February 1997) the Chief Judge held that the Court had jurisdiction to determine a s102 modification application at a time when the relevant development consent had expired (it had been granted subject to a condition limiting its life to 12 months) in circumstances where the appeal which attracted the Court’s jurisdiction had been lodged at a time when the consent was still in force.

My survey of the decided cases has confirmed that although there is no direct authority on the fundamental question raised in the present case, the question has previously been encountered but has not called for decision because of factual findings made in the cases: Bowser; Smith; & Kilizi.

Although both Bowyer and Smith appear to proceed on the unstated assumption that non-compliance with the time stipulation would result in the lapse of the deferred commencement consent, the correctness of that assumption was expressly reserved in Kilzi with an emphatic rejection by Stein J that the question had been concluded by his earlier decision in Johnson.

More certainly the cases establish that a deferred commencement consent is relevantly a development consent but one that does not operate until the deferred commencement condition is satisfied: Morris; Cameron.

The cases also establish that the power conferred by s102 to modify a development consent may be exercised in respect of a development consent at a time when it has (i) momentarily ceased to be effective by virtue of s93(2): Swadling or (ii) ceased to exist after the Court’s jurisdiction has been attributed: Peter Dallow.

I do not understand the Council to question the proposition that a deferred commencement consent is relevantly a development consent in terms of the EP&A Act. However it does dispute the application of Swadling to a deferred commencement consent where the relevant time stipulation has not been complied with, at the time that the modification application is made. In this respect it submits that the consequent lapsing of the deferred commencement consent for which it contends, distinguishes the case from the momentary ineffectiveness of the development consent that was involved in Swadling.

If the Council’s principal contention is correct, and the legal effect of non-compliance with the time stipulation is the lapsing of the deferred commencement consent, then I think it inevitable that the present case is distinguishable from Swadling.

E. Determination of the Questions of Law

Hitherto I have concentrated attention on the competing arguments in relation to the legal competence of the Applicant’s appeal pursuant to s102(5) of the EP&A Act. This, it will be recalled, was the nature of the present proceedings as originally filed. However as I have earlier noted the proceedings have been amended to include an appeal pursuant to s97(1A) and they also have been contingently amended to include a provisional appeal pursuant to s97(1).

(It is convenient to so refer to the last mentioned matter even though no such appeal has been formally filed. It is a “contingent” appeal because the Applicant only wishes to rely upon it in the event of the Court determining adversely to the Applicant the questions of law concerning the appeals pursuant to s102 and s97(1A).)

In these circumstances I should briefly refer to the competing arguments on (i) the s97(1A) appeal and (ii) the s97(1) appeal, which in some important respects are different from the principal arguments advanced on the s102(5) appeal.

(i) the s97(1A) appeal

In respect of the appeal pursuant to s97(1A) the Council argues that the appeal is incompetent because such an appeal is predicated upon the Applicant having complied with s91AA(6) “if the applicant produces evidence in accordance with this section…” (emphasis added).

The Council submits that in context, the phrase “in accordance with this section” must include compliance with subsection (5) namely that the evidence be produced to the consent authority within the time stipulated under subsection (4). Since the time stipulation was not complied with it follows that the required evidence was not produced in accordance with the section and it further follows that deeming provision contained in s91AA(6) is not activated. Based upon those premises the Council’s ultimate submission is that the Applicant’s appeal, in purported reliance on s97(1A), is legally incompetent because there has been no notice (actual or deemed) given under s91AA(6).

The Applicant’s competing argument is that the time stipulation is not a mandatory requirement of s91AA but is a directory requirement and that the requirement was substantially complied with when the Applicant produced the required evidence 2 months after the expiry of the relevant time stipulation. Based upon this premise the Applicant submits that it has complied with the requirement and that accordingly it has produced the evidence “in accordance with this section” within the meaning of s91AA(6) and that the Council thereupon was bound to notify the Applicant whether or not it was satisfied and that in consequence of its failure to so notify the deeming provision of s91AA(6) took effect and thereby founded the right of appeal conferred by s97(1A).

In so submitting that the time stipulation under s91AA is a directory requirement, as an incident of the mandatory requirement that the Applicant produce evidence in satisfaction of the deferred commencement condition, the Applicant cited, by way of illustration, the decision of the Court of Appeal in Hatton v Beaumont (1977) 2 NSWLR 211 at 223/4 where Hope JA held that the purpose of a statutory requirement contained in a regulation would be achieved, consistently with the scope and purpose of the Liquor Act and the regulation by constructing the statutory requirement “as mandatory, except as to time”.

The Council not surprisingly draws attention to the different statutory requirements and their place in the overall statutory purpose in the cases of Hatton v Beaumont and Woods v Bate (which both involved the Liqour Act) compared with the requirements of s91AA(5) and (6) and their place in the overall statutory purpose of the EP&A Act.

In this respect the Council submitted that the concept of deferred commencement consent was introduced into the EP&A Act in 1993 to accord a degree of flexibility in the scope and ambit of a development consent granted under the Act but that flexibility has been deliberately subordinated to the power to impose a time stipulation on the fulfilment of the deferred commencement condition, in order to secure ultimate certainty as to the status of a deferred commencement consent, and in particular to avoid the possibility of deferred commencement consents lying dormant for indefinite periods of time, only to be enlivened if and when the applicant decides to seek to fulfil the deferred commencement condition.

(ii) the s97(1) appeal

The Council’s principal submission is that since the Applicant accepted, and belatedly sought to fulfil, the deferred commencement condition it does not qualify “an applicant who is dissatisfied with the determination of the consent authority” within the meaning of s97(1).

Alternatively it submits that any appeal against the deferred commencement condition must have been filed during the currency of the time stipulation because upon the expiry of that time, with the deferred commencement condition unfulfilled, the consent had lapsed and there was accordingly no relevant determination with which the Applicant could be dissatisfied. Hence there was no foundation for any appeal pursuant to s97(1).

The Applicant’s competing argument emphasises that the right of appeal conferred by s97(1):
(i) is available to the Applicant within the period of 12 months after the s92 notice is received;
(ii) is founded upon “the determination” of the consent authority (ie. the grant of the deferred commencement consent); and
(iii) is available to the Applicant who is presently dissatisfied with the imposition of the deferred commencement condition which dissatisfaction is not dispelled by the Applicant’s previous attempts to comply (albeit belatedly) with the deferred commencement condition.

Finally the Applicant submits that the specification of a time stipulation pursuant to s91AA(4) specifying a period of less than 12 months does not, and cannot, abrogate the right of appeal conferred by s97(1) which is exercisable, in accordance with that section, within the period of 12 months after receipt of the s92 Notice.

It will be readily appreciated from my summary of the Council’s several arguments advanced in this case that the principal thrust is that the legal effect of non-compliance with a deferred commencement condition within the time stipulation is the lapsing of the deferred commencement consent. I think it must be at once acknowledged that if this is the true effect of the relevant non-compliance, then any appeal pursuant to s97(1), 97(1A) or 102(5) must be regarded as legally incompetent.

However I have come to the firm conclusion that Council’s principal argument is not correct. In my judgment non-fulfilment of the deferred commencement condition within the stipulated time does not cause the lapsing of the deferred commencement consent. My reasons for so concluding can be stated as follows:
(i) Not only does the EP&A Act contain no express provision to support the Council’s argument, but it contains express provisions which at the very least strongly suggest to the contrary. In particular s97(1) confers upon an applicant dissatisfied with the determination of the consent authority an unqualified right of appeal exercisable within 12 months of the receipt of the s92 Notice. Section 99 contains express provisions for the lapsing of a development consent and those provisions do not adopt the thesis advanced by the Council. Section 122 provides that a contravention of a condition of development consent is a “breach of the Act” susceptible to the remedy provided by s124 but accords no recognition to the proposition that a breach of a condition invalidates or nullifies the development consent. In the light of these express provisions it is intrinsically difficult, if not impossible, to derive by implication from the terms of s91AA, a contrary result, along the lines argued by the Council.
(ii) Even if s91AA(5) were interpreted as imposing a mandatory requirement, it would not follow that disobedience carries the consequence of an implied nullification of the antecedent grant of the deferred commencement consent;
(iii) In any event the notion of implied nullification is not applicable to the requirement imposed by s91AA(5) because the legal consequences of disobedience with the requirement are expressly provided for by s91AA(6) and those consequences do not include nullification of the deferred commencement consent.
(iv) As earlier noted the EP&A Act does not provide for, or recognise, the nullifying effect on a development consent by a contravention of a condition of that development consent. Rather it provides for the enforcement of such a contravention as a “breach of the Act” in common with contraventions of the Act or of a development consent: s122. In this respect a deferred commencement condition is a condition of development consent: s91(3)(h). Where a time stipulation is imposed it forms an integral part of the deferred commencement condition.
(v) The Council’s quest for certainty of the status of a deferred commencement consent would not be necessarily achieved or enhanced by the implication of a lapsing of a deferred commencement consent along the lines argued by the Council any more than is the case where there is a lapsing.

In so concluding I have not found it necessary up to this point to determine the Applicant’s argument that the requirement of s91AA(5) is a directory requirement, rather than a mandatory requirement.

However from what I have held concerning the effect of s91AA(6) I do not think the solution to the meaning and effect of s91AA is to be found in the principles that have been developed which distinguish between mandatory and directory requirements of an enactment. As was pointed out by Mahoney JA at 226 in Hatton those principles do not seek to answer the question: “What did the legislation intend?” because the answer is self evident “it intended that the provision be observed”. Rather as his Honour states the relevant question is: “What is the consequence if it is not observed?”

In my judgment s91AA(6) provides the Legislature’s answer to that question, namely that the Applicant does not, and cannot, qualify as “an applicant (who) provides evidence in accordance with the section” (emphasis added).

In the light of the express terms of s91AA(6) I am of the opinion that the legislature has not left unanswered the question: What is the consequence if the statutory requirement is not observed? Accordingly the Applicant’s argument that s91AA(5) should be interpreted as imposing a directory requirement is, in my opinion, simply not relevant. The meaning and effect of s91AA(6) must be closely examined in respect of the Applicant’s s97(1A) appeal. However in the present context it should be noted that the legal consequence provided by s91AA(6) of non-observance of the time stipulation does not mean that the Applicant has no other resort.

On the contrary it has the opportunity to change the content of the deferred commencement condition (or the time stipulation imposed in respect of it) by resort to s102 and s97(1), while the deferred commencement consent remains non-operative.

For all the foregoing reasons I would hold that the deferred commencement consent has not lapsed and remains in force as a development consent, although not operative “until the applicant satisfies the consent authority” of the deferred commencement condition. In that state the deferred commencement consent is capable of being modified pursuant to s102.

Concerning the s97(1A) appeal I would uphold the Council’s argument that the appeal is legally incompetent because it is not founded upon notice, (actual or deemed) of the Council’s dissatisfaction with the evidence produced in support of the deferred commencement condition.

In so holding I would accept the Council’s argument that the requirement of s91AA(6) to “produce evidence in accordance with this section” is not satisfied unless that evidence is produced, in accordance with s91AA(5), within the relevant time stipulation. In so concluding, and for the reasons earlier stated, I do not think it is open to the Applicant to argue that the requirement of s91AA(5) is directory.

Concerning the s97(1) appeal I am of the opinion for the reasons given that it is open to the Applicant to appeal pursuant to that section against the Council’s determination granting the deferred commencement consent. The Applicant is relevantly “dissatisfied” with that determination and it is not legally necessary for that dissatisfaction to have manifested itself during the time stipulation for compliance with the deferred commencement condition. In this respect there is no inconsistency between s91AA(5) and s97(1) even in circumstances where the time stipulation imposed under the former section is for a period less than the 12 month period specified in the latter section.

F. Conclusions and Orders

For all the foregoing reasons I make the following orders.
1. The questions of law are answered as follows:
Question 1 Answer: The deferred development consent has
not lapsed and is in force, although not
operative until fulfilment of the deferred
commencement condition.
Question 2 Answer: Yes.
Question 2A Answer Yes.
Question 3 Answer: Yes.
Question 4 Answer: No.
Question 5 Answer: Yes. The right of appeal expires 12
months after receipt of the s92 Notice.
2. Exhibits to remain on the file.
3. Question of costs reserved.

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I HEREBY CERTIFY THAT THIS AND THE PRECEDING 36 PAGES ARE A TRUE AND ACCURATE COPY OF THE REASONS FOR JUDGMENT HEREIN OF HIS HONOUR MR JUSTICE N R BIGNOLD.

Associate