Bowie Ferris Investments Pty Ltd v Woollahra Municipal Council

[2025] NSWLEC 60

Land and Environment Court

New South Wales

Medium Neutral Citation:

Bowie Ferris Investments Pty Ltd v Woollahra Municipal Council [2025] NSWLEC 60

Hearing dates:

27 March 2025

Date of orders:

17 June 2025

Decision date:

17 June 2025

Jurisdiction:

Class 1

Before:

Duggan J

Decision:

See orders at [33]

Catchwords:

ENVIRONMENT AND PLANNING – appeal – s 56A of the Land and Environment Court Act 1979 (NSW) – appeal against a Commissioners’ decision on a question of law – heritage impact of use of building as shop instead of pub – relevance of viability of pub – appeal dismissed

Legislation Cited:

Environmental Planning and Assessment Act 1979 (NSW), s 4.15

Woollahra Local Environmental Plan 2014

Cases Cited:

Bowie Ferris Investments Pty Ltd v Woollahra Municipal Council [2024] NSWLEC 1774

Hoxton Park Residents Action Group Inc v Liverpool City Council (2011) 81 NSWLR 638; (2011) 184 LGERA 104; [2011] NSWCA 349

Category:

Principal judgment

Parties:

Bowie Ferris Investments Pty Ltd (Appellant)
Woollahra Municipal Council (Respondent)

Representation:

Counsel:
A M Pickles SC (Appellant)
I Hemmings SC (Respondent)

Solicitors:
Mills Oakley (Appellant)
HWL Ebsworth (Respondent)

File Number(s):

2024/00475154

Publication restriction:

Nil

 Decision under appeal 

Court or tribunal:

Land and Environment Court of NSW

Jurisdiction:

Class 1

Citation:

[2024] NSWLEC 1774

Date of Decision:

29 November 2024

Before:

Dixon SC

File Number(s):

2023/00273911

JUDGMENT

Nature of the proceedings

1. Bowie Ferris Investments Pty Ltd (Appellant) has appealed the decision of a Commissioner of this Court, in dismissing its appeal for development application DA 243/2023 (DA). The DA sought approval for development described in the DA as “change of use from Village Inn Hotel to retail on the ground floor and office on the first and second floors and minor works, including modified shopfront, internal floor plan changes and identification signage”.

2. The Village Inn Hotel was located at 9-11 Glenmore Road, Paddington NSW 2021 (Building). The Building was identified as an item of local heritage significance pursuant to the Woollahra Local Environmental Plan 2014.

3. The Senior Commissioner delivered reasons for her decision in Bowie Ferris Investments Pty Ltd v Woollahra Municipal Council [2024] NSWLEC 1774 (Reasons). The facts as set out in [10]-[21] of the Reasons are adopted here without repetition.

Grounds of appeal

4. The Appellant has raised two questions of law in this appeal in that:

(1) The Senior Commissioner made an error on a question of law, by characterising the issue to be determined under s 4.15(1)(a)(i) of the Environmental Planning and Assessment Act 1979 (EPA Act) and cl 5.10 of the Woollahra Local Environmental Plan 2014 as ‘the impact of the cessation of the pub use’; being a misdirection where the correct issue was the impact of the proposed development, being the proposed shop. (Ground 1)

(2)   The Senior Commissioner made an error on a question of law by:

(a)   finding that it was necessary to establish that the continued operation of the current pub use was ‘not viable’ or ‘unviable’; and

(b)   finding that it was necessary to adduce evidence as to ‘the market value’ of the existing pub or evidence of the ‘profit and loss’ of the existing pub;

before consent could be granted to the development; being a misdirection where such matters are not relevant considerations under s 4.15 of the EPA Act. (Ground 2)

Ground 1 – The Senior Commissioner erred on a question of law by focusing on the issue of cessation of pub use on the heritage significance of the Building

5. Ground 1 concerns the Senior Commissioner’s findings at [95]-[104] which culminated in her findings at [8]-[9] and at [104] that the DA should be refused as:

8 Clause 5.10(4) of the LEP called up by s 4.15 of the EPA Act mandates consideration of the impact of the development on a heritage item. In this case, the continued operation of the Hotel has been specifically identified as an element of its heritage significance; and the loss of that pub-use is, on the current evidence, an adverse heritage impact that must be avoided.

9   While I understand all too well that I cannot force the continuation of the Village Inn’s operation as a pub, in the absence of satisfactory evidence which demonstrates that the existing pub use is unviable, I am not prepared to approve the proposed change of use to a shop as this would adversely impact the primary heritage significance of the Item being its use as a pub. …

…

104 …the removal of the pub use directly and adversely affects its heritage significance of the Hotel in contravention of the aims of the LEP in cl 1.2(2)(f) and of the relevant heritage conservation objectives and provisions in cl 5.10.

6. The substance of the complaint in Ground 1 was that the Senior Commissioner was limited in her determination as to the effects of the development the subject of the DA, which did not include the cessation of the pub use as such cessation was not development that required development consent. By considering the cessation of the pub use the Senior Commissioner asked herself the wrong question namely, what was the impact of the cessation of the pub use? The evaluative determination of relevant matters under s 4.15 of the Environmental Planning and Assessment Act 1979 (NSW) (EP&A Act) only arises when the correct question is asked; and the decision is not protected by the evaluation of matters considered relevant: Hoxton Park Residents Action Group Inc v Liverpool City Council (2011) 81 NSWLR 638; (2011) 184 LGERA 104; [2011] NSWCA 349 (Hoxton Park) at [45]. The Appellant contended that by asking the incorrect question the Senior Commissioner erred in law.

7. The Appellant summarised the proposition in the following manner at par 20 of its written submissions as:

20 Accordingly, the proper approach to the assessment of the impacts of the development was to assume that the current use had or was likely to cease and then on the basis of that assumption, to consider whether the proposed development, being the shop, had an adverse impact on the heritage significance of the heritage item, being the building. Instead, what the Senior Commissioner did is to focus upon the cessation of the use of the pub and in that context made the second error of determining that such impact needed to be justified by matters beyond s 4.15 of the EPA Act.

8. It is apparent from the Reasons that the Senior Commissioner took into account in the determination of the DA the fact that the heritage item was no longer to be used as a pub. This was not disputed by Woollahra Municipal Council (Respondent). However, whether such a consideration was an error of law was the matter in dispute as relating to Ground 1.

9. Whilst it is true that the development the subject of the DA did not include the cessation of the pub use, the term “development” as defined by the EP&A Act does not include the concept of a use ceasing as being relevantly development to which the EP&A Act relates. It is also true that the Senior Commissioner was limited to the relevant considerations that arose pursuant to s 4.15 of the EP&A Act, which were limited to those that were of relevance to the development the subject of the DA, which did not include the cessation of the pub use. However, the acceptance of these fundamental statements of principle does not resolve the issues in this appeal. Ground 1, as framed by the Appellant, turns upon a finding that such a consideration was an error in law in that the Senior Commissioner asked herself the wrong question. The error asserted was that she considered that the cessation of the pub use was development for which development consent was required. In that respect, it was necessary that the Appellant demonstrate that the Senior Commissioner considered that the cessation of the pub use was relevantly development to which the DA related.

10. I am unable to make such a finding.

11. At [1] of the Reasons the Senior Commissioner stated:

1 This is an appeal pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 (EPA Act) against the refusal by Woollahra Municipal Council of a development application (DA 243/2023) for the use of the Village Inn Hotel at 9-11 Glenmore Road, Paddington, as a shop; and, therewith, the associated works to facilitate that use. The case hinges on the Hotel’s heritage status and the impact upon what is a significant local establishment were it to cease trading as a licensed premises.

12. By the first sentence above, the development the subject of the DA on is correctly identified. The second sentence is a statement of the primary merit issue raised by the proceedings. The identification of the merit issue does not disclose a mistake as to the nature of the development the subject of the DA.

13. The Reasons identified at [24] that of the contentions raised in the appeal before the Senior Commissioner at the hearing the remaining contentious issue in the appeal was the proposed change of use. I note in passing that whilst the Appellant took some issue with whether the DA was in fact for a change of use, the use of this language by the Senior Commissioner is of no consequence, it is merely a reflection of the language used in the Amended Statement of Facts and Contentions to which she was referring.

14. Thereafter, the Senior Commissioner proceeded to consider that remaining contention. The Senior Commissioner identified:

1. The facts: at [10]-[16];

2. The relevant planning controls: at [17] and [22];

3. The relevant evidence: at [26]-[29], [30]-[49];

4. The submissions of both parties: at [50]-[87]; and

5. The findings based upon the above matters: at [90]-[104] of the Reasons.

15. Importantly, in the context of this appeal the Senior Commissioner made findings of fact that:

1. The historic contribution of the public house on the site since 1848 to the social fabric of the suburb and the city in general is not disputed by either heritage expert (Mr Phillips for the Appellant and Ms Holtham’s for the Respondent). Both experts agreed that a relevant significant component of the Building is its continuous use as a pub or public house together with its fabric: see Reasons at [16].

2. Mr Phillips accepted Ms Holtham’s assessment that the continued use of the Building as a pub is an important element of its heritage significance. However, Mr Phillips said his assessment was based on an understanding that it had been demonstrated that “the historic contribution of the pub use was no longer viable”. He gave evidence that he was supportive of the proposed change to a shop because of the existing premises’ unviability. He repeated this justification in both the Heritage Impact Statement and the joint report as recited at [33] of the Reasons:

As with many listed buildings, its current use as a Public House is no longer viable and as happens to many heritage items, an appropriate adaptive reuse is sought. Where a change of use occurs with a heritage listed buildings, an interpretation strategy and plan are put in place to ensure the former use can be recognised and understood by the general public...

In this case a use that is sympathetic to the building is proposed as it has been demonstrated that operation as a hotel is not viable” (Ex 3 pars 14, 16, 25-26; HIS).

…poor ongoing patronage, ongoing debt, and failure during the recent sales campaign to sell the hotel to a publican to enable the continued Hotel use” (HIS p 43).”

“…the economic viability of the property as a pub was not sustainable” (HIS p 45).

3. Mr Phillips said that the reason that he believed the pub use was unviable was because the vendor’s real estate agent, Mr Handy, had told him that “no pub operators were interested in purchasing the [Hotel] and leasing it”: see Reasons at [34].

4. Mr Phillips acknowledged the argument for the continuation of an historical use where that use can be reasonably undertaken. And while he accepted that the change of use from a pub to a shop would result in “a diminution of the social significance of the Item because the social significance is ascribed to the Hotel” in this case, he gave evidence that it is justified because the continued use cannot be reasonably undertaken as illustrated by the sales campaign: see Reasons at [37].

16. From the findings of fact made by the Senior Commissioner upon the evidence adduced in the proceedings it is apparent that there was a single remaining contention in the appeal that related to the impact of the proposed development upon the heritage significance of the Building. Part of that heritage significance was that the Building had been used continuously as a pub. The use of the Building for retail and office uses would not be a continuation of the pub use with the consequence that there would be a diminution in the heritage significance of the heritage item. The Senior Commissioner (and by inference the parties) accepted that she was obliged to consider whether such an impact on the heritage significance was acceptable.

17. Those findings relate to the evidence and submissions made, they do not disclose that the Senior Commissioner has identified the cessation of the pub use as part of the development the subject of the DA nor that she asked herself the wrong question with respect to the impact of the use of the building as a shop. Rather, the Senior Commissioner has considered the heritage impact of the development the subject of the DA, which was the use of the Building as a shop.

18. The approach taken by the Senior Commissioner arose due to the particular factual circumstances of the case before her. The heritage significance of the Building was linked to the continued use as a pub. In order to determine whether the impact of the use as a shop was acceptable she had to consider the impact of using the Building for a purpose other than a pub. In doing so, she was considering the impact of the development as proposed in the DA and not on the assumption that the development proposed included the cessation of the pub use as “development” to which the EP&A Act applied.

19. For those reasons, the Appellant has failed to demonstrate that the Senior Commissioner erred in law in the manner contended in Ground 1. Accordingly, Ground 1 has not been made out and is dismissed.

Ground 2 – The Senior Commissioner erred on a question of law by focusing on the viability of the hotel

20. Ground 2 concerned the finding that justification of the impact of the proposed development was required as set out in the Reasons at [101]-[103] which stated:

101 The continued operation of this heritage-listed hotel over the last 170 years (SHR Criteria A – Historical significance) which is a primary reason for its heritage significance and listing, is clearly a relevant consideration when assessing the effect of this DA under cl 5.10(4). Mr Phillips gave consistent oral and written evidence that he supported the proposed development because he believes that the continued pub use is unviable. The basis upon which he reaches that conclusion is on the advice of the former owner’s sales agent, Mr Handy, that there was no interest during the marketing campaign for the sale of the Item as a pub at the market price of $6.5 million (HIS p 44; Ex F). Relevantly, there is no evidence before the Court supporting Mr Handy’s assertion that the asking price of $6.5 million was a realistic market price for the Hotel. No valuation evidence in respect to the property. Nor any financial evidence adduced directed to the question of viability, no profit or loss evidence or financial records to support the assertions made by Mr Phillips’ in the HIS that the applicant had needed to reduce the rent to obtain a licences to run the Hotel and that such a continuing pub use was unprofitable and therefore unviable.

102   As Ms Holtham observes, the unceasing use of the heritage Item as a pub is integral to its significance and statutory listing in Sch 5 (Ex 3). I accept Ms Holtham’s expert assessment that the social heritage value of the heritage Item will be essentially lost if this DA is approved because the pub use will cease. As the cessation of that use will adversely affect the heritage significance of the Item, there needs to be some reasonable basis and weighing of all the evidence to justify that heritage effect and outcome.

103   Having carefully considered all evidence (including the LEP, and the zone objectives, the provisions of the DCP, and importantly the heritage experts’ evidence and the public interest), I do not accept that the resulting adverse impact on the heritage Item should rest upon unproven evidence of the unviability of the Hotel’s continued operation. To be plain, there has been no satisfactory “demonstration that the operation of the Hotel is not viable”.

21. The Appellant contented that the Senior Commissioner erred in taking into account the viability of a pub use as the economic viability of the pub use was not relevant. Further, that by considering the issue of viability, the Senior Commissioner was in fact seeking the Appellant to justify the proposed development in circumstances where there is no warrant to require justification beyond a consideration of the environmental impacts.

22. To the extent that it may be said against the Appellant that it was its expert, Mr Phillips, that raised the issue of viability as a justification for his acceptance of the heritage impact of the proposal the Appellant responded to such a suggestion in the following terms at par 45 of its written submissions:

45 ...Even if the applicant had, through its heritage consultant, referred to the pub as no longer being “viable,” that did not have the effect of making it a relevant matter to consider under s 4.15 of the EPA Act. Matters of relevance to the determination of a DA are circumscribed by the EPA Act not by reference to extraneous matters referred to in a development application. If the matter of viability of the pub use was not relevant, which the Council agreed it was not, it was not relevant at all.

23. Ground 2, like Ground 1, relied upon the contention that the Senior Commissioner had erred in law in that she had misdirected herself in that she considered that it was “necessary” to find that the pub use was “unviable” or that some other “justification” was required in order for the development as proposed to be approved. Inherent in this ground is a suggestion that the Senior Commissioner considered that such a finding was necessitated as a matter of principle to which she was bound to consider.

24. Such a finding cannot be made, and Ground 2 must be dismissed.

25. The issue of viability was not raised as a matter of principle, nor did the Senior Commissioner deal with it as if it were. The issue of viability was raised by the Appellant as a merit consideration in the determination of the impact on the heritage significance of the heritage item.

26. Mr Phillips gave the evidence consistent with the Senior Commissioner’s findings outlined at [15] above. It was Mr Phillips that identified that his opinion as to the acceptability of the heritage impact on the Building was that the continued use of the pub was unviable. He identified no other reason to justify his conclusion.

27. The Senior Commissioner’s Reasons notes the position of Mr Phillips at [96]. She notes the agreement between the experts that the continuation of the pub use is an identified element of the Building’s heritage significance at [100]. Her consideration thereafter of the viability of the use of the Building as a pub is in the context of it being the sole reason for the support by the Appellant’s heritage expert for the use of the Building as shop, with the consequential impact on the heritage significance of the Building. It is a merit consideration based upon the heritage assessment of the heritage significance of the Building, based upon the evidence that was adduced before her. This consideration does not disclose a misdirection, rather the uncontroversial resolution of the dispute on the evidence before her.

23. There is no part of the Senior Commissioner’s Reasons that identified that she considered it necessary that there be some justification or that the pub use was unviable in order for her to be able to approve the development. Rather, in the context of considering whether the agreed adverse impact on the heritage significance of the Building was acceptable she was required to consider the evidence before her, and to the extent that such evidence was disputed as between the experts she was required to resolve that dispute. She did so. To the extent that the Senior Commissioner made findings as to viability and justification she did so in the context of determining whether to accept the expert opinion of Mr Phillips or Ms Holtham. She preferred the evidence of Ms Holtham. Such an approach is conventional and does not disclose an error of law.

24. Further, to the extent that it is necessary to decide the matter, the Senior Commissioner, in determining the issue posed to her by the Appellant’s own heritage expert, she does not determine that the lack of viability would not justify the heritage impact. Rather, the Senior Commissioner determined that on the evidence adduced by the Appellant as to the lack of viability, that such evidence was insufficient to satisfy her that the continued use as a pub was, in fact, unviable. As a consequence, the Senior Commissioner determined that, in effect, the Appellant had failed to prove its own case to the necessary degree, and therefore the DA was to be refused.

25. The Senior Commissioner’s approach to the issues in dispute and the consideration of the evidence adduced to support the Appellant’s case as formulated by it was entirely conventional and does not disclose an error of law of the type identified in Ground 2.

Conclusion and orders

31. For the reasons outlined, the appeal is dismissed.

32. It was accepted by the parties that costs of this appeal should follow the event and I will make such order.

33. The Court orders that:

1. The Summons commencing an appeal filed 20 December 2024 is dismissed; and

2. The Appellant is to pay the Respondent’s costs of the appeal.

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Decision last updated: 17 June 2025