Burwood Council v Ralan Burwood Pty Ltd (No 3) - [2014] NSWCA 404

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Burwood Council v Ralan Burwood Pty Ltd (No 3) [2014] NSWCA 404
Hearing dates: 14, 15, 16 October 2014
Decision date: 27 November 2014
Before: McColl JA at [1];
Barrett JA at [2];
Sackville AJA at [3]
Decision:
1. Subject to the orders made on 6 June 2014, the motion filed by the first respondent (Ralan) on 3 April 2014 be dismissed.
2. The appeal be dismissed.
3. The appellant (the Council) pay Ralan's costs of the appeal, including Ralan's costs thrown away by reason of the vacation of the hearing on 9 April 2014 and the costs of the motions filed by Ralan on 3 April 2014 and by the Council on 28 May 2014.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords:
ENVIRONMENT AND PLANNING - validity of construction certificates - primary judge erred in finding that construction certificates were not inconsistent with development consent - whether finding of inconsistency would render construction certificates invalid - scope and purpose of statutory regime construed as a whole does not require a finding of invalidity where construction certificates found to be inconsistent with development consent

ENVIRONMENT AND PLANNING - where construction certificates found to be inconsistent with development consent - whether development was carried out otherwise than in accordance with the development consent - application of s 80(12) of the Environmental Planning and Assessment Act - construction certificates deemed to form part of development consent

ENVIRONMENT AND PLANNING - responsibility for carrying out development - whether respondent could be held responsible for any failure to carry out the development in accordance with the Environmental Planning and Assessment Act

ENVIRONMENT AND PLANNING - exercising a function under the Environmental Planning and Assessment Act - respondent developer was not exercising a power, authority or duty directly conferred or imposed by the Act
APPEAL - where primary judge in the Land and Environment Court erred in finding construction certificates were inconsistent with development consent - whether Court of Appeal can make findings to resolve the factual question - whether Court of Appeal can proceed assuming that factual finding to resolve question of law as to validity of challenged construction certificates
Legislation Cited:
Building Professionals Act 2005 (NSW) ss 5, 5A, 7, 8, 19, 21, 22, 31, 39, 40, 85, sch 3
Environmental Planning and Assessment Act 1979 (NSW)
Environmental Planning and Assessment Amendment Act 1997 (NSW)
Environmental Planning Legislation Amendment Act 2006 (NSW)
Interpretation Act 1987 (NSW) s 9(2)
Supreme Court Act 1970 (NSW) s 75A
Trade Practices Act 1974 (Cth) s 75B
Environmental Planning and Assessment Regulation 2000 (NSW) cll 139, 140, 142, 145, 147
Environmental Planning and Assessment Amendment (Miscellaneous) Regulation 2007 (NSW)
Uniform Civil Procedure Rules 2005 (NSW) r 51.36
Cases Cited: Bass v Permanent Trustee Co Limited [1999] HCA 9; 198 CLR 334
Botany Bay City Council v Saab Corp Pty Ltd [2011] NSWCA 308; 82 NSWLR 171
Burwood Council v Ralan Burwood Pty Ltd (No 2) [2014] NSWCA 179
Burwood Council v Ralan Burwood Pty Ltd [2013] NSWLEC 173
Coffs Harbour Environment Centre Inc v Minister for Planning (1994) 84 LGERA 324
El Cheikh v Hurstville City Council [2001] NSWLEC 175; 115 LGERA 425
Hare v Harmer [2009] NSWCA 68
Hillpalm Pty Limited v Heaven's Door Pty Limited [2004] HCA 59; 220 CLR 472
Kirk v Industrial Court of New South Wales [2010] HCA 1; 239 CLR 531
Lesnewski v Mosman Municipal Council [2005] NSWCA 99; 138 LGERA 207
Marvan Properties Pty Ltd v Randwick City Council [2005] NSWLEC 9; 138 LGERA 1
Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (No 2) (1997) 42 NSWLR 641
Moy v Warringah Council [2004] NSWCCA 77; 133 LGERA 49
North Sydney Council v Moline (No 2) [2008] NSWLEC 169
Northern Residential Pty Ltd v Newcastle City Council [2009] NSWCA 141; 75 NSWLR 192
Prepaid Services Pty Ltd v Atradius Credit Insurance NV [2013] NSWCA 252
Progress & Securities Building Pty Ltd v Burwood Council [2008] NSWLEC 1178
Progress and Securities v Burwood Council [2006] NSWLEC 706
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355
Smith v Wyong Shire Council [2003] NSWCA 322; 132 LGERA 148
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247
Wilkie v Blacktown City Council [2002] NSWCA 284; 121 LGERA 444
Woods v Bate (1986) 7 NSWLR 560
Yorke v Lucas [1985] HCA 65; 158 CLR 661
Texts Cited: Macquarie Dictionary
Shorter Oxford English Dictionary
Category: Principal judgment
Parties: Burwood Council (Appellant)
Ralan Burwood Pty Ltd (First Respondent)
Lyall Ernest Dix (Second Respondent)
John Morgan (Third Respondent)
William Peter O'Dwyer (Fourth Respondent)
The Owners - Strata Plan No. 88309 (Fifth Respondent)
Representation: Counsel:
TS Hale SC / SB Nash (Appellant)
P Tomasetti SC / J Johnson (First to Fourth Respondents)
Solicitors:
Houston Dearn O'Connor (Appellant)
Storey & Gough Lawyers (First to Fourth Respondents)

File Number(s): 2013/339576
Publication restriction: None
Decision under appeal

Citation:

[2013] NSWLEC 173

Date of Decision:

2013-10-16 00:00:00

Before:

Sheahan J

File Number(s):

40091 of 2013

Judgment

McCOLL JA: I agree with Sackville AJA's reasons and the orders his Honour proposes.

BARRETT JA: I am of the opinion that, upon full analysis of the statutory provisions, the conclusions stated by Sackville AJA at [206] of his reasons are correct for the reasons he states. The orders his Honour proposes at [213] should be made.

SACKVILLE AJA: The appellant (Council) appeals against a judgment of the Land and Environment Court (L & E Court) dismissing Class 4 proceedings brought by the Council against three respondents, including the first respondent in this Court (Ralan): Burwood Council v Ralan Burwood Pty Ltd [2013] NSWLEC 173 (Sheahan J) (Primary Judgment). The proceedings concern a major residential and commercial development project located at 1-3 Railway Parade in the centre of Burwood (Property). The project has attracted considerable controversy.

The development is the subject of Strata Plan 88309 (Strata Plan) and is now complete. The development comprises three towers on a retail/commercial podium. It incorporates 268 residential units and 62 retail and commercial suites, together with parking and other ancillary facilities. Two of the towers have 19 levels and the third has 16 levels.

In the L & E Court, the Council sought declarations that the design and construction of the building were inconsistent with the modified development consent (DA) granted to Ralan and that Construction Certificates issued by private certifiers in respect of the development (CCs) were void and of no effect. The Council also sought orders requiring Ralan to undertake extensive rectification works intended to make the completed building conform more closely to the DA. The Council instituted the proceedings pursuant to s 123 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act).

The Council's case in the L & E Court rested on what were said to be major inconsistencies between the DA and the CCs, although the issues were considerable narrowed by the time the parties made their final submissions. In this Court, the Council has focussed specifically on claims that the façade of the building bears little relationship to the plans and specifications incorporated in the DA. The Council accepts that the façade conforms with the plans and specifications provided by or on behalf of Ralan to the accredited certifiers, who issued the CCs. However, the Council says that the CCs wrongly state that the plans and specifications provided to the certifiers are consistent with the DA. It follows, so the Council argues, that the CCs are void and provide no protection to Ralan against the relief sought by the Council. This is said to be so even though the building is now complete and the vast majority of units in the Strata Plan have been sold and the new owners (or their tenants) have taken possession.

Parties

The respondents to the proceedings in the L & E Court were Ralan and the two accredited certifiers who issued the impugned CCs (Mr Dix and Mr Morgan). The two certifiers entered submitting appearances in the proceedings before the primary judge, and an appearance on the appeal, but have played no part in the appeal.

The amended notice of appeal filed by the Council on 11 December 2013 joined two additional respondents. The fourth respondent (Mr O'Dwyer) is the sole director of Ralan and, as the primary Judge found, controls Ralan and the group of which Ralan forms part. It appears that Mr O'Dwyer was joined as a respondent because he gave an undertaking to the L & E Court at the hearing held after Sheahan J had reserved his decision. His Honour permitted Mr O'Dwyer to give an undertaking to replace an undertaking previously given by Ralan and Mr Morgan, which had effectively prevented Ralan completing building work and completing the sales of individual units (see at [83] below). Mr O'Dwyer did not make any submissions on the appeal separate to those of Ralan.

The fifth respondent (Owners Corporation) was created by virtue of registration of the strata scheme in respect of the development. The Owners Corporation was served with the amended notice of appeal but did not wish to be heard on the appeal. Despite being encouraged to file a submitting appearance, the Owners Corporation did not do so.

The hearing of the appeal was listed for two days, commencing on 9 April 2014. On 3 April 2014, Ralan filed a notice of motion seeking an order that the appeal be dismissed for want of necessary parties, namely the owners and occupiers of lots in the Strata Plan. In the alternative, Ralan sought an order requiring the Council to serve notice of the proceedings on all owners and occupiers of the lots.

On 9 April 2014, the Court vacated the hearing and gave directions for the hearing of Ralan's motion before me. The Council ultimately filed a motion seeking representative orders as a mechanism to overcome the difficulty that the orders for rectification work, if granted, would affect the interests of the proprietors and occupiers of lots in the Strata Plan.

In a judgment delivered on 6 June 2014 (Burwood Council v Ralan Burwood Pty Ltd (No 2) [2014] NSWCA 179) I made the following orders:

"1. The appellant (Council), in addition to appearing on its own behalf in this appeal, be appointed to represent the owners and occupiers of lots in Strata Plan SP88309 who support the making of the orders sought by the Council in the amended Notice of Appeal.

2. The respondent (Ralan), in addition to appearing on its own behalf in this appeal, be appointed to represent in this appeal the owners and occupiers of lots in Strata Plan SP88309 who oppose the making of the orders sought by the Council in the amended Notice of Appeal."

Directions were given requiring the Council to give notice of the appeal to each owner and occupier and the Council duly did so. The orders made on 6 June 2014 made provision for any person wishing to be joined as a party to the appeal or to make submissions to apply for leave to do so.

The hearing of the appeal took place over three days, from 14 to 16 October 2014. No owner or occupier took advantage of the opportunity to be joined as a party to the appeal or to make submissions.

Further Evidence

Both parties sought to adduce further evidence on the appeal in reliance on s 75A(7) of the Supreme Court Act 1970 (NSW). Although there was some debate, ultimately the further evidence was admitted without objection. The Council's further evidence included photographs of the façades of the completed building which were clearer than similar photographs in the Appeal Books. Ralan's further evidence was an affidavit upon which it relied to support its contention that if the Council's appeal should succeed, the matter should be remitted to the L & E Court.

Legislation

A considerable number of statutory provisions and regulations were referred to in submissions. It is convenient to set out here the provisions of particular significance to the appeal.

The EPA Act

The Council brought these proceedings pursuant to s 123(1) and seeks relief pursuant s 124 of the EPA Act. These sections are in Div 3 of Part 6 of the EPA Act and relevantly provide as follows:

"123 (1) Any person may bring proceedings in the Court for an order to remedy or restrain a breach of this Act, whether or not any right of that person has been or may be infringed by or as a consequence of that breach.

...

124 (1) Where the Court is satisfied that a breach of this Act has been committed or that a breach of this Act will, unless restrained by order of the Court, be committed, it may make such order as it thinks fit to remedy or restrain the breach.

(2) Without limiting the powers of the Court under subsection (1), an order made under that subsection may:

...

(b) where the breach of this Act comprises the erection of a building or the carrying out of a work-require the demolition or removal of that building or work".

Section 122(a) of the EPA Act states that in Div 3 of Part 6 a reference to "a breach of this Act" is a reference to

"(i) a contravention of or failure to comply with this Act, and

(ii) a threatened or an apprehended contravention of or a threatened or apprehended failure to comply with this Act".

A reference to "this Act" in Div 3 of Part 6 includes the Environmental Planning and Assessment Regulation 2000 (NSW) (EPA Regulation) and "a consent granted under this Act, including a condition subject to which consent is granted": s 122(b).

The foundation of the Council's claim for relief is that Ralan breached s 76A(1) of the EPA Act. The sub-section provides as follows:

"If an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry the development out on land to which the provision applies unless:

(a) such a consent has been obtained and is in force, and

(b) the development is carried out in accordance with the consent and the instrument."

"Development" is defined by s 4(1) of the EPA Act to include:

"(c) the erection of a building, and

(d) the carrying out of a work".

The term "carry out" is not defined.

Division 2 of Part 4 of the EPA Act establishes detailed procedures, including the opportunity for public submissions, for the consideration and determination of a development application. In determining a development application, a consent authority (in this case the Council) is to take into account a number of matters specified in s 79C(1) of the EPA Act, including:

"(b) the likely impacts of that development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality,

...

(d) any submissions made in accordance with this Act or the regulations,

(e) the public interest."

The consent authority is to determine a development application by granting consent, either unconditionally or subject to conditions, or by refusing consent: s 80(1).

Section 96 of the EPA Act empowers a consent authority to modify a development consent. It may do so, inter alia, if satisfied that the development to which the consent as modified relates "is substantially the same development as the development for which consent was originally granted": s 96(2)(a). Before modifying the development consent, the consent authority must undertake certain consultations and consider any submissions made concerning the proposed modifications: s 96(2)(b), (d). The consent authority must also take into account such of the matters in s 79C(1) as are of relevance to the development the subject of the application: s 96(3).

Section 81A(2) of the EPA Act provides as follows:

"The erection of a building in accordance with a development consent must not be commenced until:

(a) a construction certificate for the building work has been issued by the consent authority, the council (if the council is not the consent authority) or an accredited certifier".

The expression "accredited certifier" is relevantly defined in s 4(1) to mean "the holder of a certificate of accreditation as an accredited certifier under the Building Professionals Act 2005".

Section 81A(5) of the EPA Act states that the regulations may make provision concerning the issue of certificates for the erection of buildings and the subdivision of land.

Section 80(12) is headed "Effect of issuing construction certificate". It provides as follows:

"If a consent authority or an accredited certifier issues a construction certificate, the construction certificate and any approved plans and specifications issued with respect to that construction certificate, together with any variations to the construction certificate or plans and specifications that are effected in accordance with this Act or the regulations, are taken to form part of the relevant development consent (other than for the purposes of section 96)."

Part 4A of the EPA Act (ss 109C-109R), is headed "Certification of Development". Part 4A was inserted by the Environmental Planning and Assessment Amendment Act 1997 (NSW) (1997 Act), although there have been subsequent amendments.

A construction certificate may be issued for the purposes of Part 4A of the EPA Act: s 109C(1). Section 109C(1)(b) defines a "construction certificate" to mean:

"a certificate to the effect that work completed in accordance with specified plans and specifications will comply with the requirements of the regulations referred to in section 81A(5)."

A construction certificate is one of several kinds of certificate, collectively known as "Part 4A certificates", for which the EPA Act provides: s 109C(1).

A construction certificate may be issued by a consent authority, the council or an accredited certifier: s 109D(1)(b). The expression "certifying authority", which is used elsewhere in the EPA Act and the EPA Regulation, is defined in s 4(1) to include a person authorised by or under s 109D to issue Part 4A certificates.

The person having the benefit of a development consent is to appoint a principal certifying authority (PCA) in respect of building work involved in the development: s 109E(1)(a). That person may appoint the consent authority, the council or an accredited certifier as the PCA: s 109E(1)(b). Section 109E(3) relevantly provides as follows:

"A principal certifying authority for building work ... to be carried out on a site is required to be satisfied:

(a) that a construction certificate ... has been issued for such of the building work ... as requires development consent and over which the principal certifying authority has control, before the work commences on the site, and

...

(d) that building work ... on the site has been inspected by the principal certifying authority ... on such occasions (if any) as are prescribed by the regulations ... before the principal certifying authority issues an occupation certificate ... for the building or work".

Section 109F is critical to the validity of the CCs in the present case. The section is headed "Restriction on issue of construction certificates". It provides as follows:

"(1) A construction certificate must not be issued with respect to the plans and specifications for any building work ... unless:

(a) the requirements of the regulations referred to in section 81A(5) have been complied with, and

(b) any long service levy payable under section 34 of the Building and Construction Industry Long Service Payments Act 1986 (or, where such a levy is payable by instalments, the first instalment of the levy) has been paid.

(1A) A construction certificate has no effect if it is issued after the building work ... to which it relates is physically commenced on the land to which the relevant development consent applies".

Subsection (1A) was inserted into s 109F by the Building Professionals Act 2005 (NSW) (BP Act) sch 3, cl 12.

An applicant for a construction certificate may appeal against the decision of a consent authority to refuse to issue the construction certificate: s 109K(1). Since an accredited certifier is not a "consent authority", there appears to be nothing to stop an applicant for a construction certificate applying to a consent authority (such as a council) if the accredited certifier refuses to issue a construction certificate.

A person must not commence occupation or use of the whole or any part of a new building unless an occupation certificate (either interim or final) has been issued: s 109M(1). Section 109H(5)(b) provides that, where a building has been erected pursuant to a development consent, a final occupation certificate must not be issued to authorise a person to commence occupation or use of a building unless "a construction certificate has been issued with respect to the plans and specifications for the building".

Ralan relies on s 109P of the EPA Act to support its contention that it is entitled to rely on the CCs as issued. Section 109P is as follows:

"(1) A person who exercises functions under this Act in reliance on a Part 4A certificate ... is entitled to assume:

(a) that the certificate has been duly issued, and

(b) that all conditions precedent to the issuing of the certificate have been duly complied with, and

(c) that all things that are stated in the certificate as existing or having been done do exist or have been done,

and is not liable for any loss or damage arising from any matter in respect of which the certificate has been issued.

(2) This section does not apply to a certifying authority (other than a council or consent authority) in relation to any Part 4A certificate ... that the certifying authority has issued."

"Functions" is defined in s 4(1) of the EPA Act to include "powers, authorities and duties".

Section 125(1) of the EPA Act provides that where the Act forbids any matter or thing to be done, a person offending against the prohibition is guilty of an offence.

EPA Regulation

Clause 139(1) of the EPA Regulation specifies requirements that an application for a construction certificate must comply with. An application for a construction certificate may only be made by a person who is eligible to appoint a PCA for the relevant development: cl 139(1A). As has been seen, s 109E(1)(a) of the EPA Act provides that it is the person having the benefit of a development consent who is to appoint a PCA.

A certifying authority (including an accredited certifier) may require an applicant for a construction certificate to give the certifying authority additional information concerning the proposed building that is essential to the certifying authority's proper consideration of the application: cl 140(1). However, nothing in cl 140 "affects the certifying authority's duty to determine an application for a construction certificate": cl 140(2).

Clause 142(2) of the EPA Regulation requires the certifying authority to give notice to the consent authority and the council of its written determination of an application for a construction certificate. This must be done within two days of the determination. The notification must be accompanied by the relevant plans and specifications and any fire safety schedule attached to the certificate.

Clause 145(1) relevantly provides as follows:

"A certifying authority must not issue a construction certificate for building work unless:

...

(a) the design and construction of the building (as depicted in the plans and specifications and as described in any other information furnished to the certifying authority under clause 140) are not inconsistent with the development consent, and

(b) the proposed building (not being a temporary building) will comply with the relevant requirements of the Building Code of Australia (as in force at the time the application for the construction certificate was made)."

Clause 147(1) states that a construction certificate "must contain" certain information. The requirements include:

"(e) a statement to the effect that work completed in accordance with documentation accompanying the application for the certificate (with such modifications verified by the certifying authority as may be shown on that documentation) will comply with the requirements of this Regulation as are referred to in section 81A(5) of the Act."

Building Professionals Act

The BP Act establishes a regime for the accreditation and discipline of certifiers. It repealed and replaced Part 4B and Div 3 of Part 4C of the EPA Act, inserted by the 1997 Act, which established a similar although less elaborate regime.

A person may apply to the Building Professionals Board (BP Board) for a certificate of accreditation as an accredited certifier: ss 5(1), 5A(1). The Board may refuse an application on a variety of grounds, for example, if it is not satisfied that an individual applicant has the requisite qualifications, skill, knowledge and experience, or has failed to comply with a statutory or other duty relating to the functions of a person as an accredited certifier: s 7(1).

The Board may suspend or cancel a person's certificate of individual accreditation on a number of grounds, for example where it forms the opinion that the certifier is not a fit and proper person to hold a certificate of accreditation: s 8(2). In addition, Part 3 of the BP Act establishes procedures for the making of complaints about the "professional conduct" of an accreditation holder: ss 19(1) (definitions), 21(1).

The Board is required to investigate complaints against accreditation holders, although it may decide to take no action in respect of a particular complaint: s 22. If the Board is satisfied following its investigation that the accreditation holder is guilty of "unsatisfactory professional conduct" or "professional misconduct", the Board may impose sanctions: ss 27, 31. These include, in the most serious cases, cancellation of the certifier's certificate of accreditation: s 31(4)(i). The Board must publicise disciplinary action taken against an accreditation holder and, to this end, must maintain a public register of disciplinary action taken: ss 39(1), 40(1).

Part 6 of the BP Act specifies requirements that accreditation holders must comply with. These include prescribed standards of record keeping, minimum indemnity insurance cover and the avoidance of conflicts of interest: ss 60, 63, 66.

Section 85(1)(a) of the BP Act creates an offence of issuing a Part 4A certificate (including a construction certificate) by a person not authorised to do so under the BP Act or the EPA Act. It is also an offence for a person to make any statement that is false or misleading in a material particular in or in connection with a Part 4A certificate: s 85(1)(b). The predecessor of these provisions was s 109ZH in the now repealed Part 4B of the EPA Act.

A Chronology of Events

The Development Consent

On 13 November 2006, the L & E Court upheld an appeal by the original purchaser of the Property, Progress and Securities Pty Ltd (P & S), against the refusal of the Council to grant a development consent for the project: Progress and Securities v Burwood Council [2006] NSWLEC 706. The Court granted development consent to construct a mixed-use development consisting of 233 dwellings, shops and commercial suites on the Property. The building was to comprise three towers erected on the Property, which itself is adjacent to railway lines. The northern façade of the building faces the railway line; the southern façade faces Railway Parade. Tower A is the western tower; Tower B the central tower; and Tower C the eastern tower.

On 15 May 2008, the L & E Court upheld a second appeal by P & S: Progress & Securities Building Pty Ltd v Burwood Council [2008] NSWLEC 1178. On this occasion, the Court modified the development consent in respect of the Property, pursuant to s 96 of the EPA Act. The conditions of consent required the development to be carried out in accordance with the approved plans and other documents identified in the conditions. The relevant plans included plan COM-A-902 Revision F dealing with "Finishes".

Condition 220G provided that the finishes of the proposed development had to be:

"in accordance with External Finishes Board, which was prepared by Dickson Rothschild [responsible for the Statement of Environment Effects] which is plan COM-A-902 Revision F and was issued on 23 April 2008 referred to in condition 1. Any modification to the finishes described in the External Finishes Board, at any time in the future, must be approved by RailCorp before it is carried out."

The Council's submissions to the primary Judge identified a number of external features of the building depicted in the plans accompanying the DA (the modified development consent) which were said to have been omitted or substantially modified in the plans submitted to the certifiers. These features included louvres on the eastern and western façades of the buildings; curtain walls with hidden frames on the central portion of each of Towers A, B and C; the distinctive colouring of window frames; frames and glass panels with three horizontal divisions on the lower portions of the northern and southern façades; and vertical columns breaking up the southern and northern façades of Towers B and C, incorporating horizontal louvres within each column.

The Council's case, as presented on appeal, is that the CCs provided for the erection of a building with very different external features to those depicted in the plans and specifications approved in the DA and thus the CCs are inconsistent with the DA. These inconsistencies, so the Council argues, have the consequence that the CCs are void and of no effect. The Council relies principally for this submission on s 109F(1) of the EPA Act and cl 145(1)(a) of the EPA Regulation (reproduced at [29], [37] above, respectively).

Ralan Acquires the Property and Makes Arrangements

On 25 September 2008, Ralan, which had recently been incorporated, entered into a contract to purchase the Property from P & S. The purchase price was $21.95 million, with a completion date of ten months from the date of the contract. Mr O'Dwyer's practice was to incorporate a company specifically for the purpose of undertaking a fresh development. The incorporation of Ralan reflected this practice.

Sales of units "off the plan" by Ralan commenced in October 2008, although at that stage it was not expected that building work would commence for another 12 months. Mr O'Dwyer gave evidence that most purchasers of units were investors.

On 31 July 2009, Mr O'Dwyer confirmed Ralan's acceptance of a tender by Steve Nolan Constructions Pty Ltd (SNC). The tender price was $70.15 million plus GST for the design and construction of what was described as "The Emporium" project. SNC, the principal of which was Mr Nolan, had regularly undertaken work for companies within the Ralan Group under "design and construct" contracts. Despite Ralan's acceptance of the tender, the formal building contract with SNC was not executed until 8 April 2010.

On 4 August 2009, SNC retained Stephen Bowers Architect Pty Ltd (SBA) to prepare construction drawings for the development.

On 19 November 2009, Mr Bowers of SBA sent a letter to SNC. The letter relevantly is as follows:

"As discussed please find attached list of amendments to the design consistent with the intent of the approval which facilitate significant cost reductions:

...

2 no external fins

...

4 no curtain walls, window wall to be used

...

6 simplified structure plates and column layout."

Although it is not entirely clear, the expression "no external fins" seems to refer to removal of the louvres from the approved plans and specifications.

On 23 November 2009, Mitchell Brandtman (NSW) Pty Ltd (Brandtman) prepared a "Pre-Commencement Report" for the project. The report noted that the Contractor (SNC) had tendered for the project and that the tender price of $70.15 million provided "excellent value for money". The report also noted that:

"the documentation currently available is being reviewed and refined by the Contractor and his consultants as part of the design / construct process. This has improved the projects 'buildability' and thus construction costs have reduced compared to the drawings issued with the DA."

The contract for the sale of the Property to Ralan was completed on 15 December 2009.

On 15 February 2010, the Commonwealth Bank (CBA) confirmed to Ralan approval of a loan to the company of $93 million to assist with the development of the Property. A condition precedent was a satisfactory fixed price building contract providing for a total construction cost of $70.15 million. All relevant statutory approvals were to be in place, including Council approved plans and specifications, a development consent and construction certificates. The facility was to be the subject of guarantees, including one from Mr O'Dwyer personally.

Ralan, as the owner of the Property, appointed Mr Dix as the PCA for the project pursuant to s 109E(1)(b) of the EPA Act. Mr O'Dwyer signed the appointment on behalf of Ralan on 17 December 2009 and Mr Dix did so on 5 May 2010.

As has been noted, Ralan and SNC entered into the building contract for the project on 8 April 2010. The primary Judge described the contract (at [76]) as "a fairly standard 'design and construct' contract". The time until Practical Completion was to be 85 weeks.

The Construction Certificates

Mr Dix issued CCs Nos 1, 2 and 3 on 31 August 2010, 23 December 2010 and 31 October 2010, respectively. Although the primary Judge referred to these CCs in his reasons, none is relevant to the appeal.

On 12 March 2012, Mr Dix issued CC No 4 (CC 4) for the proposed development. CC 4 related to the erection of the development and was "issued for building works up to and including Level 3". CC 4, which was received by the Council on 15 March 2012, was in the following form:

Mr Dix issued CC No 5 (CC 5) on 17 May 2012 for works up to Level 12 of the development. It followed the same form as CC 4 and a copy was received by the Council on 21 May 2012.

Mr Dix issued CC No 6 (CC 6) on 8 August 2012 for Levels 13 and above of the development. It, too, was in the same form as CC 4 and a copy was sent to the Council in accordance with cl 142(2) of the EPA Regulation.

The Council's Responses

The Council wrote to Mr Bowers on 12 September 2012 complaining about the use of translucent panels on the façade of the building. The letter is as follows:

"I refer to the above development and to your recent conversation with Council's Manager, Building & Development, Mr Brian Olsen regarding the external finishes to the above building. With the gradual removal of the scaffolding around the building that is under construction it has become apparent that translucent panels have been used in the external façades of the building.

The translucent panels were not included on the schedule of exterior finishes in the plans approved by the Land & Environment Court of NSW in its decision dated 15 May 2008. The translucent panels have a markedly different appearance to the materials as approved by the Land & Environment Court of NSW. As such, the translucent panels are considered to detract from the appearance of the building as a whole, adversely impacting upon the visual amenity of the area, as well as creating an unsatisfactory precedent for the Burwood Town Centre.

Your urgent attention to this matter is requested to ensure that the building is erected in accordance with the approval granted by the Land & Environment Court of NSW to save any further action by Council."

The Council intended copies of this letter to be sent to Mr Dix, SNC and Ralan, but his Honour found (at [134]) that this did not happen.

Mr Bowers responded on 17 September 2012. He said that in:

"developing the court approved design, we had discovered certain inconsistencies in the documentation."

Mr Bowers particularised in the letter some "shortcomings in the illustrative Materials and Finishes elevation". The letter concluded as follows:

"Finally we are advised by Counsel that the CC forms part of the Court's Consent once granted.

We trust the attached figures and associated information assuages Council's concerns regarding the consistencies with the Court's consent in respect to translucency of the glass façade."

Mr Olsen, who was at the time an accredited building surveyor, was handling the matter on behalf of the Council. He and Mr Bowers had a meeting at some time between 12 and 17 September 2012. Mr Olsen then went on leave from 22 September until 11 October 2012, but did not hand responsibility for the matter to anyone else within the Council.

In about late October 2012, the Council started to receive complaints from members of the public about the external appearance of the building. In October and November 2012, Mr Olsen provided written reports to the Council's General Manager.

The primary Judge made a finding (at [141]) about Mr Olsen's position at this time:

"The position Olsen took in October/November went no deeper than making observations which indicated that he could not be satisfied that the work was either within or outside the approval, but his two memorandums did not go even that far. He and Macdonnell [the Council's Deputy General Manager] agreed that they should simply wait to see if Bowers' assurances proved sound even though completion was not far away, at which stage it may prove too late to question the finishes."

Mr Dix is disqualified

On 22 November 2012, Mr Dix's accreditation as a certifier was cancelled by the BP Board and he was disqualified from acting as an accredited certifier for five years. There is no suggestion that his disqualification related to his conduct in issuing CCs for Ralan's project.

The Council Institutes Proceedings

The Council issued a media release on 27 November 2012 headed "Council United Against Eyesore Says Mayor". The media release included the following:

"Residents are up in arms over a large-scale development along Railway Parade in Burwood which was never approved by Burwood Council says Mayor, Cr John Faker.

'This terrible eyesore, which can be seen all around Sydney, casts a grave shadow over Burwood's heritage and progress,' says Mayor Faker.

'I cannot stress enough that Council has never supported the design of the building or the magnitude of the development.'

Burwood Council rejected applications for the site on several occasions but Council's decision was overturned by the Land and Environment Court in 2006 and 2008.

'Both Council and the Burwood Town Planning Panel have voted in opposition to the development on several occasions and have consulted with the architect on the finishing of the building, which has design variations to that approved by the Land and Environment Court,' says Mayor Faker.

'We are now investigating and seeking advice of what actions we can take regarding the finishing.'"

A Mayoral Minute was tabled at a Council meeting held on 4 December 2012. The Minute expressed concern that the external finishes of the building might not have been in accordance with the modified development consent. The Council resolved to engage urban design consultants to carry out an assessment of the external façade and finishes of the development.

This led to the engagement of Ms Morrish, principal of G M Urban Design & Architecture Pty Ltd. Ms Morrish reported to the Council on 14 and 20 December 2012 that the materials used on the façade of the building should be deemed unacceptable, that the building had discrepancies and was vastly different from the plans that had been approved.

The Council's solicitors wrote to Ralan's solicitors on 20 December 2012, threatening legal proceedings. The solicitors enclosed a copy of a letter sent by them to Mr Dix. The letter sent to Mr Dix contained the following passage:

"our client is investigating by way of comparison the differences between the approved Development Application and the approved Construction Certificate plans to see what changes were made to the external fabric of the building to see whether or not the changes made to the Construction Certificate plans are 'not inconsistent' with the development approval. If Council forms a view that the amendments do not meet that requirement then Council may need to seek orders in relation to the invalidity of the relevant Construction Certificate and that would involve the need to join you to the threatened proceedings."

The Council's solicitors sent a further letter to Ralan's solicitors on 23 January 2013 warning that in the absence of suitable undertakings proceedings would be instituted. On 12 February 2013, the Council commenced proceedings in the L & E Court.

Mr Morgan is appointed

On 11 February 2013, Ralan appointed Mr Morgan as the PCA for the project, in place of Mr Dix. Issues subsequently arose concerning the validity of Mr Morgan's appointment, but they are no longer relevant.

On 19 February 2013, Mr Morgan issued an interim occupation certificate for Tower A and associated car parking. On the same day, the Council filed an amended summons in the L & E Court joining Mr Morgan as a respondent to the proceedings. Shortly thereafter an order was made for an expedited hearing of the proceedings.

On 15 March 2013, Mr Morgan issued an interim occupation certificate in respect of the residential component of Tower B.

The Hearing in the Land and Environment Court

The hearing commenced before Sheahan J on 25 March 2013 and continued for 13 hearing days. On 30 April 2013, Sheahan J reserved his decision.

On the second day of the hearing, Ralan gave an undertaking to the L & E Court that it would not permit the occupation or use of the building on the Property without a final occupation certificate and that it would not apply for an interim or final occupation certificate without prior notification to the Council. Mr Morgan undertook not to issue an interim or final occupation certificate until further order.

Subsequent Developments

On the day the hearing concluded (30 April 2013), the Council issued a development consent for a strata subdivision of the development. The consent provided for 268 residential lots, additional commercial and retail lots and common property.

On 8 May 2013, the Council issued a strata plan subdivision certificate in respect of the development. The Council did so pursuant to s 109D(1) of the EPA Act.

At this point, Mr O'Dwyer was presumably keen to proceed to completion of the building and of the contracts for the sale of units in the development. Accordingly, Ralan filed a motion seeking to reopen the hearing so that it could apply to be released from the undertakings given by it and Mr Morgan.

Sheahan J heard the motion on 14 May 2013 and made orders partially releasing Ralan and Mr Morgan from their undertakings, in favour of a personal undertaking given by Mr O'Dwyer (Primary Judgment at [32(d)]). Mr O'Dwyer's undertaking was as follows:

"[I] undertake to the Court that I will guarantee personally the carrying out of any work on the building at 1 Railway Parade, Burwood which the Court might order [Ralan] to carry out in these proceedings."

Mr Morgan issued an interim occupation certificate on 12 June 2013 for the residential sections of Towers A, B and C.

On 25 June 2013, the Land and Property Management Authority registered the strata plan of subdivision in relation to the Property.

Between 16 July 2013 and 14 August 2013 sales of 264 of the 268 residential units in the building were completed. On 18 July 2013, the moneys due to CBA under the secured loan were repaid.

Despite having reserved his judgment on 30 April 2013 and again on 14 May 2013, the primary Judge recalled the parties to a further hearing on 13 August 2013 and requested further assistance on certain issues. As a result, the parties filed an Agreed Statement of Facts covering the relevant events which had occurred between 19 April 2013 and 18 July 2013. They also tendered by agreement an exchange of correspondence which had the effect of narrowing the relief sought by the Council.

The Primary Judgment

The primary Judge summarised (at [204]) the relief sought by the Council as follows:

"Substance of relief

(A) declarations that all 6 challenged CCs issued by Dix are void and of no effect

(B) declarations that CCs 4 to 6 depict a building which is 'inconsistent with' that depicted in the [DA]

(C) declarations that Ralan is in breach of the EPA Act

(D) orders that Ralan proceed to implement the 'Morrish changes'

(E) an order that the respondents pay Council's costs."

The reference to the "Morrish changes" is to a set of draft orders proposed by the Council in closing submissions to the primary Judge, which incorporated changes recommended by Ms Morrish to the façade of the building. His Honour said (at [194(4)]) that these proposed changes were put forward as a minimum of potential improvements intended to achieve an adequate solution to the design problems identified by Ms Morrish in her evidence.

The Morrish changes were recorded by his Honour (at [194(4)]) as the following:

"● Remove the glazing modules at the tops of all the towers to both the north and south which were intended to be CW2 and replace with a neutral grey glass with frame behind the glass to create true visual differentiation.

● Remove the continuous 'solid' vertical panels that are glazed with the more solid blue grey glass to the north and south elevations for the full height of the tower and the full height of the shoulders of the towers and replace with a new material that provides vertical emphasis. It should have as much horizontal projection or be recessive to create vertical emphasis that begins to break up the overwhelming length of the combined building form and gives visual relief. There should be no framing visible for these elements.

● Removal of the cladding to the edges of the floor slabs for the entire building returning down the sides of the building until meeting the vertical screens (see below) and replace with a new cladding panel that matches the colour of the new vertical material, preferably with a greater projection where possible that the existing glass façade to give visual emphasis to the horizontal proportion between the vertical elements.

● Removal of the more 'solid' blue glass above the hamper window bands and replace with a glass that gives the impression of a darker grey closer to the effect of the clear glass to balance the proportion of darker/clear to the blue more solid panel.

● For the podium link between the towers to Railway Pde change the glass below the hamper panels and above the hamper panels to the same darker grey glass (closer to the effect of the clear glass) to differentiate more effectively between the tower forms.

● Provide and fix powder coated aluminium vertical louvre blades over the existing façade to the sides of each of the towers for one of the modules of the façade to introduce vertical emphasis and create visual relief. The extent may vary on each tower subject to the module proportions."

The primary Judge identified (at [265]) four issues for determination:

"● Firstly, the restriction on persons against whom orders may be made;

● Secondly, the principles of vicarious liability and their possible application to the facts of the present case;

● Thirdly, the validity or otherwise of Dix's six CCs; and

● Fourthly, the utility of making declarations which do not form a basis for substantive orders against appropriate persons/parties."

Earlier, his Honour noted (at [247]) that Ralan did not deny its involvement in the development of the Property, but did deny that it breached either the DA or the EPA Act. His Honour also observed (at [260]) that the L & E Court cannot grant relief in the absence of proven or apprehended breaches of the law and that relief can only be awarded against the parties who are responsible at law for the breaches. He pointed out (at [262]) that Mr Dix was not an agent of, or contractor to SNC or Ralan, but was:

"an independent accredited person, appointed to his task as PCA pursuant to a non-planning statute, and as such he is amenable to discipline by the BPB".

Rather curiously, the primary Judge said (at [266]) that the first question to be addressed was that "of granting relief against persons who are not directly responsible for any breach". His Honour referred (at [267]-[278]) to authorities, such as Wilkie v Blacktown City Council [2002] NSWCA 284; 121 LGERA 444, which hold that the EPA Act authorises orders only against persons who are in breach of, or have breached that Act.

His Honour said (at [281]) that Ralan

"is relevantly the owner of the project, but took, as is apparently O'Dwyer's personal style, a very passive role in its execution."

His Honour recorded (at [282]) that Ralan had admitted, through its senior counsel, that it was carrying out development on the Property. Furthermore, Mr O'Dwyer admitted that he came to know of some of the changes. Nonetheless, in his Honour's view (at [283]):

"Ralan cannot be said to be guilty of 'some participation in express authorisation of [positive] acts constituting the carrying out of development' in breach of the [DA]". (Citations omitted.)

It was not sufficient, in his Honour's view (at [284]), that the amendments to the DA may have resulted in costs savings to Ralan.

According to the primary Judge (at [286]), the second question was whether "breach can be sheeted home to relevant parties, e.g. Ralan, because of the actions of others". In answering this question, his Honour considered that the authorities dealing with "vicarious liability" in criminal cases were relevant. His Honour held (at [288]) that:

"[t]he established principles require that clear instructions be given, and/or that control be exercised, and that the actions be taken 'in furtherance of the company's interests'." (Emphasis in original.)

Earlier in the Primary Judgment (at [246]-[256]) his Honour had made a number of findings relevant to the second question he identified for determination. The findings included the following:

Mr O'Dwyer was not a technical person from a construction point of view. He engaged staff and contractors, especially Mr Nolan, whom he trusted "and, in a hands-off way, he back[ed] them" (at [246]).
Under the contract between Ralan and SNC, the latter was given access to and possession of the building site and was given care of the whole of the work throughout the project. However the contract permitted Ralan to access the site for any purpose after giving notice to SNC, provided it did not impede SNC (at [250]).
Mr Bowers was retained by SNC to do the design for the project, but the Council had not sought any relief against him (at [251]). Mr Bowers was responsible for determining the changes that should be made to the DA and for apprising Mr Dix, as the PCA, of the desired changes. Mr Bowers had no control over Mr Dix in his adjudication of the changes (at [253]).
SNC built the development "in strict accordance with Dix's CCs, which sanctioned the changes" (at [255]).

The primary Judge concluded (at [289]) as follows:

"(1) ... Ralan cannot be found, on the evidence in this matter ... to be vicariously responsible for any breach by Dix, who, although chosen by Ralan/SNC/Bowers, enjoyed a statutory independence from them, and

(2) ... none of the conduct of SNC or Bowers amounts to a breach of the EPA Act, for which Ralan can be held responsible, as the principal in the (head) contract under which they were engaged."

The third and "central" question was the validity of the CCs. The primary Judge referred (at [293]-[302]) to the judgment of Hodgson JA in Northern Residential Pty Ltd v Newcastle City Council [2009] NSWCA 141; 75 NSWLR 192. In that case, Hodgson JA expressed the view (at [57]) that s 109J(1) of the EPA Act (which states that a subdivision certificate "must not be issued" for a subdivision unless certain requirements are met) imposed conditions of validity of the certificate. The primary Judge said that he was "very comfortable" (at [303]) in following Hodgson JA's "considered dicta". It appears that the primary Judge accepted that the dicta applied to s 109F(1) of the EPA Act, which uses similar language to s 109J(1). It seems to follow that his Honour would have held that the CCs were invalid if he found that they were issued in contravention of s 109F(1)(a) of the EPA Act.

For this reason, the primary Judge thought (at [317]) that cl 145 of the EPA Regulation (the terms of which are set out at [37] above) played "a key role in determining the validity of the CCs". His Honour rejected the Council's submission that the plans and specifications submitted to and certified by Mr Dix were inconsistent with the DA. Accordingly, the CCs had not been issued in breach of cl 145 of the EPA Regulation and no contravention of s 109F(1)(a) of the EPA Act had occurred. It followed that the CCs were valid.

The primary Judge reasoned as follows:

"[325] On any measure, this has been a huge development on a confined site, in difficult circumstances. A certain amount of adjustment or reconfiguration was inevitable, and the court, while respecting Byrnes's analysis of the changes made, accepts the explanations provided by Bowers, and also his assurance that he at no stage deliberately ignored the question of whether his changes might, in some cases, warrant the making of a modification application.

[326] Some adequately explained adjustment in the colour of some glazing, and the decision to abandon the proposed louvres, which Council now says were 'a major and important design feature', resulted in changes in final presentation which proved unacceptable to Council, and to its design expert, Morrish.

[327] As I have already noted, reasonable minds differ on such merits issues, and I certainly express no view on them.

[328] However, I do echo the concern expressed by Pepper J in Armstrong [Kogarah City Council v Armstrong Alliance Pty Ltd (No 2) [2013] NSWLEC 32]: Private certifiers play a vital role in ensuring appropriate (including 'consistent') development takes place, and the certification system must not fall into disrepute and so undermine the planning regime in this State. What might be seen as unacceptable by some, including regulators and expert commentators, as here, may not represent a breach of the certifier's duty, and/or any infringement of the planning regime.

[329] What matters to the court is that all the fundamentals of the project, as defined in the [DA] ([14] and [38] above), remained in place after certification.

[330] I have concluded that they clearly do, and that the challenged CCs are valid.

[331] Those engaged by and on behalf of Ralan to complete the project were entitled to rely on them, and there is absolutely no evidence that they strayed beyond them. The evidence suggests, on the contrary, that the building works were performed to a satisfactory standard.

[332] In those circumstances, I conclude that (1) none of the nine declarations finally sought, in respect of the CCs, and (2) neither of the declarations, and none of the orders finally sought, against Ralan, ought be made."

The cross-references in [329] of the Primary Judgment require explanation. At [14] his Honour quoted the general description of the "Building Works" in each CC (see [61] above). At [38] he merely recorded that:

"[t]he project comprises three towers ('A', 'B' and 'C') on a retail/commercial podium, and includes 268 residential units, 62 retail and commercial suites, and associated underground parking; it has cost between $120M and $150M ... and it has generated some controversy."

Since the Council had failed to establish its entitlement to the relief it sought, the primary Judge had no need to consider the fourth question, namely the utility of making the declarations sought by Council. However, given all that had transpired since the parties' main submissions in April 2013, his Honour was not convinced (at [340]) that there would be any utility in making the declarations sought concerning the CCs.

Nor did his Honour need to consider whether he would exercise his discretion to withhold relief from the Council, even though much of the evidence was directed to that issue. Nonetheless, he expressed a view:

"[342] There was a fair amount of criticism, in particular, of Council's delay in bringing these proceedings ... but also of (1) its late campaign against the almost-finished project, (2) the alleged inequity of its bringing the case when Ralan was at its most vulnerable, after Bowers had regularly consulted Council and, at least temporarily, allayed its emerging concerns, and (3) the fact that the victims of Council's success in the case would, primarily, be innocent parties, especially Ralan's purchasers.

[343] Council's response to the respondents' evidence and submissions on discretion was relatively weak, and I believe that, had it been necessary to decide it, I would have exercised my discretion against granting relief."

The primary Judge recorded (at [344]) that the Council had abandoned its claims against Mr Dix and Mr Morgan. Accordingly, he dismissed the Council's Third Further Amended Summons and ordered it to pay the costs of all three respondents.

Submissions

The Council's Submissions

The Council's written submissions in this Court summarise its claim before the primary Judge as follows (with some editorial changes):

"(a) The design and construction of the building, as depicted in the plans and specifications comprised in the CCs was 'inconsistent with the development consent' within the meaning of cl 145(1)(a) of the EPA Regulations.

(b) As a consequence, the issue of the construction certificates was beyond power and invalid since they were issued contrary to the prohibitions in s 109F(1)(a) of the EPA Act and cl 145(1)(a) of the EPA Regulations.

(c) The building, the subject of the development consent, was erected in breach of s 81A(2)(a) of the EPA Act, since a construction certificate had not been issued by an accredited certifier prior to the commencement of the erection of the building.

(d) Further, even though the building was erected generally in accordance with the CCs, by reason of the inconsistency between the development consent and the construction certificates in breach of s 76A(1)(b) of the EPA Act, the development was not carried out in accordance with the consent.

(e) Since Ralan carried out the development, it had:

(i) carried out the development in breach of s 76A(1)(b); and

(ii) erected the building in breach of s 81A(2)(a).

(f) The Court should therefore grant relief pursuant to s 124 of the EPA Act to remedy the breaches. The appropriate relief was to order Ralan to implement the Morrish changes."

The Council maintains the same arguments on the appeal and contends that the primary Judge erred in not accepting them.

Grounds 1 and 2 of the Council's further amended notice of appeal (Notice of Appeal) contend that the primary Judge erred in failing to make findings on crucial factual issues and in failing to give adequate reasons for concluding that Ralan had not breached the EPA Act. In particular, the Council submits that the primary Judge did not address whether the design and construction of the building, as depicted in the plans and specifications comprised in the CCs was inconsistent with the DA. A finding on that issue was:

"a necessary antecedent step to determining whether the [CCs] were invalid and whether the erection of the building commenced in breach of s 81A(2)(a) [of the EPA Act]."

The Council further submits that the primary Judge failed to make findings as to whether Ralan carried out the development in breach of Condition 220G of the DA and hence s 76A(1)(b) of the EPA Act. According to the Council, this provides an independent basis for the relief sought by it.

Ground 3 of the Notice of Appeal identifies, in general terms, findings that it is said that his Honour should have made. More detailed proposed findings are set out in the Council's amended statement pursuant to Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 51.36(2). This statement contains 14 pages of proposed findings as to:

inconsistencies between the plans and specifications for CC 5 and CC 6 and the DA; and
inconsistencies between the building as constructed and the approved plans in the DA, including Condition 220G.

In the course of oral submissions Mr Hale, who appeared with Mr Nash for the Council, recognised that it might be very difficult for this Court, on the material before it, to make the factual findings sought by the Council. He acknowledged that it would be necessary not only to canvass very detailed evidence concerning the various plans and specifications, but to assess conflicting opinions as to the significance of the disparities between the plans and specifications approved in the DA and those endorsed by the accredited certifier issuing the CCs. Accordingly, while not conceding the point, Mr Hale accepted that it might well be appropriate, if the appeal succeeds, to remit the matter to the L & E Court to enable the necessary findings to be made.

Ground 4 of the Notice of Appeal claims that his Honour erred in failing to find CC 4, CC 5 and CC 6 were void and of no effect by reason of the inconsistencies identified above. In oral submissions, Mr Hale invited the Court to rule on the question of construction of the EPA Act, even if it is not in a position to determine whether the plans and specifications in the CCs were inconsistent with the DA.

The Council's written submissions on the construction of s 109F(1)(a) of the EPA Act and cl 145(1) of the EPA Regulation were developed in its reply. The Council contends that in the approach mandated by Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 (Project Blue Sky), if a construction certificate is issued by an accredited certifier in contravention of s 109F(1)(a), the consequence is that the construction certificate is void. The Council therefore submits that the CCs issued in the present case were void and cannot be invoked by Ralan to defeat a claim that it carried out the development otherwise than in accordance with the DA, in contravention of s 76A(1)(b) of the EPA Act.

Mr Hale in his oral submissions emphasised the emphatic language in both s 109F(1) and cl 145(1) ("must not be issued", "must not issue"). He submitted that the statutory scheme suggests that a construction certificate issued contrary to the prohibition in s 109F(1) is of no legal effect. He contended that if an accredited certifier issues a construction certificate which is inconsistent with the development consent for the project and the construction certificate is nonetheless valid, statutory safeguards surrounding applications to modify a development consent would be subverted.

Grounds 5 and 6 of the Notice of Appeal challenge the primary Judge's finding that orders could not be made against Ralan because it could not be held responsible for any breach of the EPA Act that may have occurred. The Council points out that Ralan expressly conceded before the primary Judge that it was actually carrying out the development. It says that the primary Judge was distracted from the plain words of s 76A(1) of the EPA Act by introducing a requirement that Ralan had to be knowingly involved in a contravention by another party. If the development was carried out otherwise than in accordance with the DA it had to follow that Ralan was in breach of s 76A(1)(b) of the EPA Act.

Grounds 8 and 9 (there is no Ground 7) of the Notice of Appeal challenge the primary Judge's refusal to exercise his discretion to grant relief (if the Council's substantive claims had been made out) and his Honour's finding (at [340]) that it would be inutile to grant the relief sought by the Council.

Ralan's Submissions

Ralan filed a Notice of Contention. The two grounds in the Notice of Contention that were the subject of argument are as follows:

"1 The Orders of the Court below should be affirmed on the basis that even if there was a breach of the requirements of s 109F of the [EPA Act] by the certifier in issuing any of the construction certificates the subject of the proceedings, such a breach does not give rise to invalidity of the construction certificate.

...

3 In the alternative, the Orders of the Court below should be affirmed on the basis that even if there was a breach of the requirements of s 109F of the [EPA Act] by the certifier in issuing any of the construction certificates the subject of the proceedings, and even if [Ralan] is held to have carried out development, by reason of s 109P:

a. [Ralan] has not carried out development in breach of s 76A(1)(b) of the [EPA Act]; and

b. [Ralan] has not carried out development in breach of s 81A(2)(a) of the [EPA Act]."

Ralan places Ground 1 of the Notice of Contention at the forefront of its submissions. It submits that even if the plans and specifications incorporated in the CCs were inconsistent with the DA, the statutory scheme does not require the CCs to be held void and of no effect. Ralan accepts that an accredited certifier who issues a construction certificate that is inconsistent with the development consent may well contravene the EPA Act. But it contends that legislation addresses this issue through the regulatory and disciplinary provisions in the BP Act governing accredited certifiers, not by rendering the construction certificates invalid.

Ralan supports this conclusion by reference to textual indications in the legislation suggesting that a breach of the EPA Act by a certifier was not intended to invalidate a construction certificate. For example, s 109F(1A) of the EPA Act expressly provides that a construction certificate has no effect if it is issued after the building work is physically commenced, but no equivalent provision applies where a construction certificate is issued in breach of the requirement in cl 145 of the EPA Regulation that the construction certificate not be inconsistent with the development consent.

Ralan also contends that if a construction certificate is to be rendered invalid by reason of inconsistency with the development consent, considerable inconvenience would be caused. In particular, a person carrying out a development in good faith and in reliance on a construction certificate issued by an independent accredited certifier, would be at risk of being required to undertake expensive remedial work, even after completion of the project. In short, a construction certificate would be "worthless to builders, developers and lenders" and there would be no certainty as to whether a given development could safely proceed to completion.

Ground 3 of the Notice of Contention invokes s 109P(1) of the EPA Act. Ralan contends that when carrying out the development it was "exercising a function", under the EPA Act in reliance on a Part 4A certificate, namely the CCs. Thus s 109P(1) entitled it to assume that the CCs had been duly issued and all conditions precedent in the issuing of the CCs had been complied with. On this basis, so Ralan argues, it cannot be held to have breached s 76A(1)(b) of the EPA Act.

Although principally relying on Grounds 1 and 3 of the Notice of Contention, Ralan supports the findings of the primary Judge that led to the dismissal of the Council's claim. Ralan argues that his Honour correctly found that the CCs were not inconsistent with the DA. It contends that cl 145 of the EPA Regulation is concerned, not with mere differences in detail or changes in design that are "ancillary" to the core purpose of the consent, but only with fundamental departures from the DA. Thus his Honour was entitled to find that, despite some obvious differences between the plans and specifications approved in the DA and those endorsed by the CCs, the CCs were not inconsistent with the DA.

In his oral submissions, Mr Tomasetti acknowledged that if his Honour's finding that there was no inconsistency between the DA and the CCs was to be set aside, it was not feasible for this Court to decide, on the material before it, whether the CCs were "not inconsistent" with the DA. Mr Tomasetti accepted that if the question of inconsistency has to be considered afresh, the matter would need to be remitted to the L & E Court.

Reasoning

A Preliminary Issue

In my opinion, if the primary Judge's finding on the question of inconsistency is set aside, this Court cannot resolve the disputed factual issue. Such a determination, even if confined to the various plans and specifications for the façade of the building, would require a close examination of an extensive body of documentary evidence, much of which was not referred to in argument. More importantly, a determination by this Court would require an evaluation of conflicting evidence about which the primary Judge did not make findings. For example, Ralan's written submissions contend that the evidence of the Council's expert, Mr Byrnes, was flawed in certain aspects and that the evidence of Ralan's architect, Mr Bowers, should be preferred on those matters. The primary Judge referred to the evidence of Mr Byrnes and Mr Bowers (at [122]-[131], [255]-[256]), but did not resolve the issues on which they expressed differing opinions. Nor did his Honour make detailed findings as to the precise differences between the façade of the building as constructed and the plans and specifications approved in the DA. In these circumstances, I accept Mr Tomasetti's submission that it is "impossible" for this Court to make the findings necessary to resolve the question of inconsistency: see Hare v Harmer [2009] NSWCA 68 at [44]-[47] (Sackville AJA, Macfarlan JA and Handley AJA agreeing); Prepaid Services Pty Ltd v Atradius Credit Insurance NV [2013] NSWCA 252 at [52] (Meagher JA, Macfarlan and Emmett JJA agreeing).

In anticipation of the Court taking this view, both Mr Hale and Mr Tomasetti asked the Court to decide whether the impugned CCs were valid, on the assumption that the CCs were inconsistent with the DA and thus were issued in contravention of s 109F(1)(a) of the EPA Act. The parties did not advert to the possibility that this request might involve the Court in expressing a view on a hypothetical issue, a course that is not permissible: Bass v Permanent Trustee Co Limited [1999] HCA 9; 198 CLR 334 at [49] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ). However, as was indicated to counsel when the Bench raised the matter, I think it is permissible for this Court to decide the question of law without also determining itself whether the CCs were inconsistent with the DA.

It is common ground that there are some obvious differences between the design and construction of the façade of the building contemplated by the DA and the design and construction of the façade contemplated by the CCs. The dispute is whether the differences, either alone or in combination with other asserted (but disputed) differences, are such that the CCs are inconsistent with the DA, for the purposes of cl 145(1)(a) of the EPA Regulation. Resolving the question of law - whether such an inconsistency renders the CCs invalid and of no effect - is not a purely hypothetical exercise. It will determine a critical issue in the controversy between the parties: see Bass v Permanent Trustees at [52].

Two Key Findings

The primary Judge made two findings, each of which was sufficient in itself to defeat the Council's claim for relief. First, his Honour found (at [289]) that Ralan could not be held responsible for carrying out the development of the Property otherwise than in accordance with the DA. This finding rested on the proposition that if the development was carried out in breach of the EPA Act, the breach could not be "sheeted home" to Ralan. Secondly, his Honour found (at [336]) that, in any event, the CCs were not inconsistent with the DA. Thus the CCs had been issued in compliance with the EPA Act and the EPA Regulation and the development had been carried out in accordance with the DA. It followed that there had been no breach of s 76A(1)(b) of the EPA Act by Ralan or, presumably, anyone else.

In my opinion, both these findings were affected by error and must be set aside.

Ralan's Responsibility for Breach

The finding that Ralan was not responsible for any failure to carry out the development in accordance with the DA is, at first blush, surprising. At the trial, Ralan expressly conceded that "Ralan ... [was] carrying out development at the site". When taxed with this concession on the appeal, Mr Tomasetti seemed to accept that he would have difficulty in supporting the primary Judge's finding. However, in supplementary written submissions Mr Tomasetti said that, although Ralan did not resile from its concession, it continued to dispute that it had been in breach of the EPA Act.

The foundation for this submission appears to be the primary Judge's finding (at [283]) that Ralan did not expressly authorise positive acts constituting the carrying out of the development in breach of the DA. Ralan supported the primary Judge's approach on the ground that Ralan had not carried out any construction work itself, did not have the necessary control over the work and had given no instruction that building work should be carried out otherwise than in accordance with the DA.

It is not easy to reconcile Ralan's concession at the trial with its submissions on the appeal. If Ralan played the purely "passive" role attributed to it by the primary Judge, the consequence might be thought to be that Ralan was not carrying out the development (that is, the erection of the building), as distinct from carrying out the development but not bearing responsibility for any departures from the DA: see Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (No 2) (1997) 42 NSWLR 641 at 643-644 (Handley JA), cited by Davies AJA (Heydon JA and Young CJ in Eq agreeing) in Wilkie v Blacktown City Council at [40]. However, I am prepared to interpret Ralan's submissions as meaning that, although it carried out the development, it could not be held responsible for any failure by those actually designing and constructing the building to conform to the DA.

Ralan placed considerable reliance on the majority judgment (McHugh ACJ, Hayne and Heydon JJ) of the High Court in Hillpalm Pty Limited v Heaven's Door Pty Limited [2004] HCA 59; 220 CLR 472. That judgment establishes the following propositions relevant to the present case:

s 123 of the EPA Act does not empower the L & E Court to make orders remedying or restraining a breach of the EPA Act against a person who has not committed a breach of the Act (at [47]-[48]); and
in order to determine whether a person has carried out development otherwise than in accordance with a development consent, it is necessary to identify the development to which the consent relates and to enquire whether the person said to be in breach carried out that development (at [42]-[43].

(For earlier New South Wales authority accepting the first proposition, see: Wilkie v Blacktown City Council at [36].)

The second proposition stated in Hillpalm creates no difficulty for the Council in the present case. The development carried out by Ralan was that approved in the DA, that is the construction of the mixed-use residential/commercial building on the Property. This contrasts with the situation in Hillpalm, where the person said to be in breach of the conditions attached to a development consent had not carried out the relevant development (the subdivision of the land).

The first proposition established by Hillpalm, that s 123 authorises an order only against a person who has breached the EPA Act, does not lead to the conclusion that Ralan was in breach of the Act. That is a separate question. To answer that question it is necessary to consider the findings that Ralan's role in the development was purely passive and that it could not be held responsible for any breach of the DA.

The primary Judge found (at [281]) that although Ralan was the owner of the project, it took "as is apparently O'Dwyer's personal style, a very passive role in its execution". That finding reflected the primary Judge's acceptance of Mr O'Dwyer's evidence that he was "not a very technical person from a construction point of view" and that, although generally aware of Ralan's obligations under the EPA Act and the EPA Regulation, he relied on the contractors and staff engaged by Ralan. His Honour also found (at [246]) that Mr O'Dwyer wished to be made aware of any Council concerns and that (at [283]) he knew of some of the changes made to the plans and specifications approved in the DA.

Ralan's role in the project involved far more than its mere ownership of the Property. The DA was granted to Ralan's predecessor in title, P & S. Ralan purchased the Property with the benefit of the DA. Ralan intended to proceed with the construction of the approved mixed-use residential/commercial development and to sell the units. Ralan engaged SNC to construct the building pursuant to a "Formal Instrument of Agreement" which incorporated General Conditions of Contract (AS4300-1995, as amended) (Building Contract).

The Building Contract required SNC to construct the building in accordance with the plans approved in the DA, which were incorporated into the contract. SNC was obliged (cl 4.1(d)) to execute and complete the "Contractor's Design Obligations", defined to mean "all tasks necessary to design and specify the Works required by the Contract". A failure by SNC to perform properly the Contractor's Design Obligations constituted a substantial breach of the contract and entitled Ralan, subject to complying with procedural requirements, to take over the Works (cl 44). Ralan was to appoint a Superintendent (in fact Brandtman) which was to have access to the building site and was empowered to give certain directions to SNC (cll 23, 26). SNC was entitled to gain access to the Site and to have possession for the purpose of executing the Works (cl 27.1). Nonetheless Ralan was entitled, after giving reasonable notice, to "have access to any part of the Site for any purpose" (cl 27.2). Ralan paid SNC the agreed contract price to construct the building.

Mr Tomasetti cited Wilkie v Blacktown City Council, a case to which the primary Judge referred, in support of his Honour's approach. In Wilkie, a lessee of land sub-leased part of the land for a lawful purpose. The sub-lessee, in breach of the sub-lease, used the land for a purpose not authorised by the development consent. The issue for determination was whether the lessee had carried out unlawful development on the land by using it in breach of the development consent. The Court held that the mere sub-leasing of the land could not constitute a breach by the lessee of the EPA Act. Davies AJA pointed out (at [38]) that the lessee was neither the owner of the premises, nor had she derived any benefit from the unlawful development (that is, the use) of the land. Nor was she in occupation of the land on which the unlawful use had taken place (at [59]).

Davies AJA rejected the approach taken by the trial judge in Wilkie who had held the lessee liable because she had "permitted or suffered" the unlawful activity. Davies AJA pointed out (at [60]) that this language, absent its use in a statute, does not give rise to an obligation to remedy a breach. He also pointed out that, unlike other legislation, s 124 of the EPA Act does not impose liability on a person who simply aids and abets a contravention of the EPA Act, or is involved in another's contravention.

Two points may be made about Wilkie. The first is that the facts were far removed from the present case. Ralan, despite the characterisation of its conduct by the primary Judge, was not simply the owner of the Property, otherwise uninvolved in the development carried out in breach of the DA. Ralan instigated and planned the project, engaged the contractors, retained possession of the Property (subject to the contractual rights of SNC) and benefited from completion of the project. Mr O'Dwyer may have been content to rely on contractors, at least to a certain point, but that cannot alter the fact that Ralan was the active instigator, the financier (with assistance from the CBA) and the beneficiary of the development.

Secondly, s 109F(1A) of the EPA Act strongly suggests that a construction certificate issued in breach of s 109F(1)(a) is not invalid. Section 109F(1A) expressly states that a construction certificate has no effect if it is issued after the building work to which it relates is physically commenced. This provision demonstrates that if Parliament intends that a construction certificate issued in breach of statutory requirements is to be held invalid, it says so explicitly. Section 109F contains no provision equivalent to subs (1A) specifying the consequences of a contravention by a certifying authority of s 109F(1)(a).

I appreciate that s 109F(1A) was not in Part 4A as originally enacted, but was introduced by an amendment to the EPA Act in 2005 (see at [164] above). It appears (from Departmental Planning Circular PS 06-004 issued by the New South Wales Department of Planning on 13 February 2006) that the enactment of s 109F(1A) was a response to Marvan Properties Pty Ltd v Randwick City Council [2005] NSWLEC 9; 138 LGERA 1. In that case, Talbot J held that a council had power to issue a construction certificate after work on a development had commenced, notwithstanding that s 81A(2)(a) of the EPA Act prohibits the commencement of work unless a construction certificate has been issued. His Honour considered (at [34]) that it would be "anomalous" if plans and specifications that were otherwise capable of certification could not be certified because some nominal work on the development had already taken place. However, he also said (at [35]) that this conclusion did not absolve an applicant from any civil or criminal consequences that might flow from a breach of s 81A(2).

The significance of s 109F(1A) for present purposes is that Parliament has turned its attention to the consequences of a construction certificate being issued in contravention of the EPA Act, specifically, s 81A(2). It has expressly provided that a construction certificate issued after work on a development has commenced is to be of "no effect". Yet as I have pointed out, Parliament has chosen to say nothing to indicate that a construction certificate issued in breach of requirements in the regulations should also be of no effect, notwithstanding that an "objective" standard for determining whether a construction certificate is consistent with the development consent was introduced after s 109F(1A) had been enacted.

The statutory regime relating to construction certificates is to be contrasted with that applying to development consents. The validity of a development consent may be challenged on the ground that the consent authority has failed to comply with the requirements laid down by the EPA Act, for example in s 79C(1) (which specifies the matters to be taken into account by a consent authority in determining a development application). But s 101 of the EPA Act specifically provides that if public notice of the development consent has been given, the validity of the development consent cannot be challenged in any proceedings except those commenced in the L & E Court within three months. Parliament has therefore expressly recognised that the validity of a development consent may be challenged, but has imposed temporal constraints on the availability of any such challenge. By contrast, Parliament has not recognised that the validity of construction certificates may be challenged, except in the limited circumstances covered by s 109F(1A). (I leave to one side complications introduced by the constitutional entrenchment of the Supreme Court's jurisdiction to intervene in cases of "jurisdictional error": Kirk v Industrial Court of New South Wales [2010] HCA 1; 239 CLR 531).

Thirdly, s 109F(1)(a) imposes a prohibition on the issue of a construction certificate that does not comply with the requirements of regulations made pursuant to the regulation-making power conferred by s 81A(5). That power extends to the making of regulations "concerning the issue of certificates for the erection of buildings". Regulations made pursuant to s 81A(5) might impose (and do in fact impose) a range of requirements, varying from the clearly important (such as cl 145) to the relatively trivial. It would be odd, for example, if a failure by an accredited certifier to adhere to the formal requirements for a construction certificate specified by cl 147 (such matters as accreditation number, date of the certificate and date of the development consent) resulted in the invalidity of the construction certificate. Similarly, it would be odd if a construction certificate is to be held invalid because the developer fails to comply with a condition of development consent of no real significance to the building work (see cl 146(c)).

On the Council's argument, regardless of the significance of the requirements imposed by regulations made pursuant to s 81A(5), a construction certificate issued in breach of those requirements will be invalid. It is not possible to foresee the nature and extent of the requirements that might be inserted into the regulations from time to time. Consequently, the defaults in the issue of a construction certificate in a particular case may be "major or minor, deliberate or inadvertent, fundamental or marginal": Smith v Wyong Shire Council at [43]. It is difficult to conclude that the legislative purpose is served by treating a construction certificate as invalid if it issued otherwise than in compliance with the regulations, regardless of the nature or seriousness of the contravention.

Fourthly, since s 109F(1)(a) of the EPA Act incorporates requirements laid down in the regulations, the validity of a construction certificate (on the Council's argument) may turn on the application of criteria expressed in vague language or which contemplates the making of a contestable judgment. In Project Blue Sky, the High Court observed (at [95]) that if the relevant requirement does not have a "rule-like quality which can be easily identified and applied", the better conclusion is ordinarily that the requirement goes to the administration of a power, rather than to its validity.

Clause 145 of the EPA Regulation is an example of a standard which, although perhaps having a "rule-like quality", nonetheless involves the exercise of what Spigelman CJ described in Smith v Wyong Shire Council (at [22]) as an "inherently contestable" judgment. It is common, if not inevitable, that in a large scale project there will be some differences between the plans and specifications approved in a development consent and those furnished to the certifying authority responsible for issuing a construction certificate. As I have noted (at [148]), whether the differences amount to an inconsistency for the purposes of cl 145(1) might well be a difficult matter to resolve. It is not likely that the legislative scheme requires the validity of a construction certificate to depend on matters on which there is room for differing opinions.

Fifthly, the Council's argument, if accepted, would produce inconvenient consequences. In Project Blue Sky (at [97]), the majority judgment said that:

"it is unlikely that it [is] a purpose of the legislation that an act done in breach of a statutory provision should be invalid if public inconvenience would be a result of the invalidity of the act."

I have referred to the possible consequences for a developer relying on a construction certificate apparently issued lawfully. Section 81A(2) prohibits the erection of a building in accordance with a development consent unless a construction certificate has been issued. If a construction certificate is issued but is invalid because of non-compliance with the regulations, the developer may well be in breach of s 81A(2) if he or she authorises building work to commence. This will be so even if the developer has acted in good faith and has no knowledge or even means of knowledge that the construction certificate has been issued in breach of the regulations. Similarly, if a construction certificate issued in breach of the regulations is invalid, the consequence (at least on the Council's submissions) is that a person who carries out development may breach s 76A(1)(b) of the EPA Act. This could occur, for example, if the construction certificate fails to comply with the formal requirements of the regulations.

Another example of inconvenience arising from the invalidity of a construction certificate flows from the prohibition on a person commencing occupation or use of a new building unless an occupation certificate has been issued: s 109M(1). If the construction certificate issued by an accredited certifier is invalid because it does not comply with the regulations, the developer may not be able to obtain an occupation certificate. This is because s 109H(5)(b) of the EPA may well be interpreted to prohibit the issue of a final occupation certificate unless a valid construction certificate has been issued with respect to the plans and specifications for the building. If the developer has acted in good faith, the consequences of conduct by an accredited certifier beyond the developer's control or knowledge may be very serious and not only for the developer but for innocent third parties.

Mr Hale countered these examples by identifying public inconvenience that would result if a construction certificate issued in breach of cl 145 of the EPA Regulation was valid. He pointed to the potential for an accredited certifier, whether through impropriety or incompetence, to circumvent the statutory scheme governing approval for the modification of a development consent: see s 96(2), (3). Mr Hale also submitted that if an accredited certifier can issue a valid construction certificate which departs from the terms of a development consent, the safety of members of the public might be jeopardised. He gave as an illustration the case of an accredited certifier endorsing plans and specifications that create an unacceptable fire hazard in a building.

I accept that an accredited certifier who fails to comply with his or her statutory responsibilities might issue a construction certificate that facilitates the erection of a building that is inconsistent with the conditions of the development consent. However, the potential danger from impropriety or lack of competence arises because of a statutory scheme which, from the outset, has entrusted accredited certifiers (among others) with the power and duty to issue construction certificates.

This danger was foreseen and addressed by Parliament in the same legislation that introduced Part 4A (including s 109F) into the EPA Act. The Amending Act 1997 inserted Part 4B of the EPA Act which established a regime for the accreditation of certifiers, the investigation of complaints against accredited certifiers and the imposition of disciplinary sanctions in cases of "unsatisfactory professional conduct" or "professional misconduct". Part 4B was repealed in 2005 and has been replaced by the more detailed regime in the BP Act governing accreditation, complaints and discipline and related matters (see [39]-[44] above).

The statutory scheme suggests that Parliament has chosen to guard against the risk of accredited certifiers failing to comply with their statutory obligations by an accreditation and disciplinary regime, rather than by the blunt mechanism of rendering a non-complying construction certificate void. This conclusion is reinforced by the explanation given by the Minister in the Second Reading Speech for the Building Professionals Bill 2005:

"[t]he major benefits of the bill include the creation of uniform professional standards for private certifiers, a simpler regulatory system, and stronger measures to protect the safety and property of the public."

NSW Parl Deb, Legislative Assembly, 16 December 2005 (Hon D Beamer).

If the validity of a construction certificate issued in breach of the EPA Act creates a risk to public health and safety, as Mr Hale submitted, that risk would lend weight to the argument that the purpose of the legislation requires a non-complying construction certificate to be invalid. However, as Mr Tomasetti pointed out, the EPA Act contains ample powers for a council or other consent authority to intervene when public health and safety is at risk, regardless of whether a development consent or construction certificate is in force. Section 121B of the EPA Act permits a consent authority to make orders, for example, requiring the owner of premises (and, in certain circumstances, other persons):

to make repairs to a building that is likely to become a danger to the public: Table, item 4;
to do such things as are specified to ensure adequate fire safety: Table, item 6; and
to cease conducting an activity on premises (regardless of whether there is a development consent), if the activity is a threat to public health and safety and is not controlled or regulated under another Act: Table, item 8.

It must also be borne in mind that a certifying authority must notify the consent authority and the council that a construction certificate is issued within two days of making the determination: EPA Regulation, cl 142(2) ([36] above). The consent authority and council receives not only the determination and the certificate issued, but the plans and specifications and any fire safety schedule. The recipient thus has the opportunity to scrutinise the construction certificate and accompanying documentation to determine whether there is a departure from the development consent or a risk to public safety that might warrant intervention and the invocation of statutory powers.

Northern Residential v Newcastle City Council

As has been noted (at [99] above), the primary Judge relied on the view expressed by Hodgson JA in Northern Residential v Newcastle City Council at [57]. Mr Hale submitted that Hodgson JA's judgment supported the conclusion that a construction certificate issued in breach of s 109F(1)(a) of the EPA Act is void.

The issues in Northern Residential were whether subdivision certificates had been issued without the prior inspection required by s 109E(3)(d) of the EPA Act and, if so, whether the certificates were invalid. Hodgson JA held (at [45], [49]) that there had been no breach of s 109E(3)(d) and thus the question of invalidity of the subdivision certificates did not arise. Nonetheless he considered that question and concluded (at [54]) that a breach of s 109E(3)(d) would not render the subdivision certificate invalid.

Hodgson JA contrasted s 109E(3) with s 109J, which provides that a subdivision certificate "must not be issued" unless a number of conditions are satisfied. His Honour said (at [57]):

"[Section 109J] sets out a number of things that must happen before a subdivision certificate is issued. Since the 2007 amendment, these things must happen in fact, not merely to the satisfaction of the principal certifying authority. The fact that in 2007 the Legislature made that change to s 109J and not to s 109E(3) confirms, in my opinion, that the intention was that the requirements of s 109J be conditions of validity, whereas satisfaction of the principal certifying authority under s 109E(3) was not."

Hodgson JA's observations as to the effect of non-compliance with s 109J(1) were dicta. Moreover, not only were the observations made in the course of dealing with an issue not necessary for the decision, but they were not essential to resolving that particular issue. Furthermore, Hodgson JA's comments were not directed to s 109F(1) which, unlike s 109J(1), incorporates requirements in the regulations, as distinct from requirements specified in the sub-section itself.

Hodgson JA had no need to consider s 109F(1) (or for that matter s 109J) in the context of the legislation as a whole. I therefore do not think that his Honour's observations are inconsistent with the conclusion I have reached. If they are, I respectfully disagree with them.

The Council's Reliance on s 109P of the EPA Act

The Council contends that s 109P of the EPA Act (see at [32] above) contemplates that a Part 4A certificate, including a construction certificate, may be invalid if issued in breach of the EPA Act. The Council says that this supports its contention that the CCs are void.

Contrary to the Council's submission, I do not think that s 109P assumes that a Part 4A certificate issued in breach of the EPA Act is invalid. The provision operates, among other things, to limit the liability of a certifying authority (if a council or consent authority) which acts on the faith of a Part 4A certificate. The assumption underlying s 109P is that a relevant certifying authority may require protection from suits by third parties relating to a matter the subject of a certificate, even if it has acted on the faith of a valid Part 4A certificate.

In any event, it is clear that some Part 4A certificates will be invalid. This will be the case with a construction certificate issued after building work has physically commenced on the land to which the development consent relates, since s 109F(1A) provides that such a construction certificate has "no effect". Section 109P(1) protects a consent authority (among others) which acts in reliance upon a construction certificate which otherwise would be of no effect. Section 109P(1) therefore qualifies the operation of s 109F(1A).

For these reasons, I conclude that even if the CCs in this case were issued in contravention of s 109F(1)(a) of the EPA Act, they were not void and of no effect.

Ralan's Reliance on s 109P of the EPA Act

Ralan relies on s 109P of the EPA Act for a different purpose than the Council. It submits that s 109P entitles it to rely on the CCs issued by the accredited certifier regardless of whether they were issued in breach of s 109F(1) and indeed regardless of whether they are otherwise void. While it is not necessary, in view of other conclusions I have reached, to address this submission I shall do so briefly.

The question posed by s 109P(1) is whether a person is exercising a function (defined to include a power, authority or duty) under the EPA Act in reliance on a Part 4A certificate. If so, that person is entitled to assume that the Part 4A certificate has been duly issued and that all conditions precedent have been duly complied with and that person is not liable for any loss or damage arising from any matter in respect of which the certificate has been issued. Section 109P(2) provides that the section does not apply to a certifying authority, other than a council or consent authority, in relation to a Part 4A certificate that the certifying authority has issued. Thus, s 109P(1) does not apply to an accredited certifier in relation to a construction certificate that the certifier has issued.

Section 109P(1) operates to limit the liability to third parties of a person who exercises functions under the EPA Act. The expression "who exercises functions under this Act" is apt to refer to a body, such as a council or consent authority, or to an individual such as an accredited certifier, who exercises a power, authority or duty directly conferred or imposed by the EPA Act. Ralan has the benefit of the DA and of the CCs issued by the accredited certifiers. If valid, these render lawful conduct that otherwise would or might be in breach of the EPA Act. Ralan is certainly acting pursuant to a development consent and construction certificates granted by a body or individual exercising a power, authority or duty under the EPA Act. But Ralan itself is not exercising a power, authority or duty under the EPA Act. It is merely acting in a way that would or might be unlawful if it did not have the benefit of the DA or the CCs.

This construction of s 109P(1) is consistent with other provisions in the EPA Act. For example, s 4(3) refers to functions being conferred or imposed by or under the Act on a council, while s 4(3A) refers to functions conferred or imposed by or under the Act on a public authority. These provisions suggest that a person exercises a function under the EPA Act only when acting directly pursuant to powers, authorities or duties conferred or imposed by the EPA Act. The EPA Act does not contain any reference to "functions" being imposed or conferred on persons who have the benefit of a development consent or a construction certificate.

It is also difficult to see why s 109P would be intended to limit the liability not only of bodies or individuals directly exercising powers, authorities or duties under the EPA Act, but the liability of persons who have the benefit of development consents or Part 4A certificates. On Ralan's construction of s 109P, the subsection limits the liability of a developer to third parties for loss or damage arising from "any matter in respect of which the certificate has been issued". Legislation having such a far-reaching potential effect on the rights and duties of private individuals under the general law can be expected to use clearer and more specific language to achieve such a result.

A Contravention of s 76A?

Mr Hale submitted that even if the CCs are not invalid, Ralan contravened s 76A(1)(b) of the EPA Act in that it carried out the development otherwise than in accordance with the DA. This submission assumes that the development was in fact carried out otherwise than in accordance with the DA.

The primary Judge made no finding on this question, which is not necessarily identical to the question of whether the CCs were inconsistent with the DA: cf Moy v Warringah Council at [78], where Sperling J said that the formula "substantially the same development" in s 96 does not have the same import as the expression "not inconsistent with" in cl 145 of the EPA Regulation. The Council claims that the development was not carried out in accordance with the DA because the building was constructed in conformity with the CCs and the CCs were inconsistent with the DA. I shall assume for present purposes that this is so.

To determine whether, on this assumption, Ralan breached s 76A(1)(b) of the EPA Act, it is necessary to consider s 80(12). It provides relevantly that if an accredited certifier issues a construction certificate, the certificate and any plans and specifications issued with respect to that certificate are taken to form part of the relevant development consent, other than for the purposes of s 96.

In this case, an accredited certifier issued the CCs. They are valid, at least until set aside. The plain words of s 80(12) have the effect of deeming the plans and specifications issued by the accredited certifier with respect to the construction certificate to be part of the DA. To the extent that there is an inconsistency between those plans and specifications and the plans and specifications approved in the DA, the former must prevail. The legislation accommodates the possibility that an accredited certifier will issue a construction certificate in breach of cl 145(1) and s 109F(1) by according paramountcy to the plans and specifications referred to in the construction certificate.

Neither party made any point of the concluding words of s 80(12) "(other than for the purposes of section 96)". The words do not, in any event, detract from this construction of s 80(12). Section 96 of the EPA Act permits a consent authority to modify a consent. The evident purpose of the quoted words is to ensure that on an application under s 96, a subsisting construction certificate does not prevent the consent authority exercising its powers.

This construction of the legislation reflects the approach mandated in Project Blue Sky at [70]:

"A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. Reconciling conflicting provisions will often require the court 'to determine which is the leading provision and which the subordinate provision, and which must give way to the other'. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme." (Citations omitted.)

For these reasons, the Council's alternative submission must be rejected.

Orders

I have reached the following conclusions:

the primary Judge erred in finding that the CCs were not inconsistent with the DA;
the primary Judge erred in finding that Ralan could not be held responsible for any failure to carry out the development in accordance with the EPA Act;
on the assumption that the CCs were inconsistent with the DA and had been issued in breach of s 109F(1)(a) of the EPA Act, the CCs were nonetheless valid;
the effect of s 80(12) of the EPA Act was that the approved plans and specifications issued with respect to the CCs formed part of the DA; and
Ralan was therefore not in breach of s 76A(1) of the EPA Act.

It follows that, for reasons different from those given by the primary Judge, the Council's appeal must be dismissed. The Council must pay Ralan's costs of the appeal.

There remains one issue as to costs. Reference has been made (at [10] above) to the motion filed by Ralan on 3 April 2014. That motion, together with the motion filed by the Council seeking representative orders, involved three hearings, on 23 April 2014, 7 May 2014 and 28 May 2014.

The costs of the hearing on 23 April 2014 were reserved. The Council was ordered to pay Ralan's costs of the hearing on 7 May 2014. On 28 May 2014, I made directions for the filing of submissions in relation to the costs of the motions. Those directions were not complied with.

On the final day of the hearing of the appeal, Mr Tomasetti handed up a brief written submission seeking an order in Ralan's favour for the costs of the motions, regardless of the outcome of the appeal. The Council responded in writing, seeking an order in its favour for the costs thrown away by reason of the vacation of the hearing set down for 9 and 10 April 2014. The Council also seeks an order for the "costs associated with the making of the representative orders", except for the costs order made on 7 May 2014.

The hearing was vacated on 9 April 2014 because the appeal was not properly constituted as to parties. This was the Council's responsibility and would have been the Council's responsibility even if Ralan had not filed its own motion. The appeal could not proceed unless and until the Council regularised its position. This it ultimately did (with a little guidance).

There is no basis for making the costs orders sought by the Council. It should pay the costs of both motions.

I propose the following orders:

1. Subject to the orders made on 6 June 2014, the motion filed by the first respondent (Ralan) on 3 April 2014 be dismissed.

2. The appeal be dismissed.

3. The appellant (the Council) pay Ralan's costs of the appeal, including Ralan's costs thrown away by reason of the vacation of the hearing on 9 April 2014 and the costs of the motions filed by Ralan on 3 April 2014 and by the Council on 28 May 2014.

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Decision last updated: 28 November 2014

Medium Neutral Citation:	Burwood Council v Ralan Burwood Pty Ltd (No 3) [2014] NSWCA 404
Hearing dates:	14, 15, 16 October 2014
Decision date:	27 November 2014
Before:	McColl JA at [1]; Barrett JA at [2]; Sackville AJA at [3]
Decision:	1. Subject to the orders made on 6 June 2014, the motion filed by the first respondent (Ralan) on 3 April 2014 be dismissed. 2. The appeal be dismissed. 3. The appellant (the Council) pay Ralan's costs of the appeal, including Ralan's costs thrown away by reason of the vacation of the hearing on 9 April 2014 and the costs of the motions filed by Ralan on 3 April 2014 and by the Council on 28 May 2014. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	ENVIRONMENT AND PLANNING - validity of construction certificates - primary judge erred in finding that construction certificates were not inconsistent with development consent - whether finding of inconsistency would render construction certificates invalid - scope and purpose of statutory regime construed as a whole does not require a finding of invalidity where construction certificates found to be inconsistent with development consent ENVIRONMENT AND PLANNING - where construction certificates found to be inconsistent with development consent - whether development was carried out otherwise than in accordance with the development consent - application of s 80(12) of the Environmental Planning and Assessment Act - construction certificates deemed to form part of development consent ENVIRONMENT AND PLANNING - responsibility for carrying out development - whether respondent could be held responsible for any failure to carry out the development in accordance with the Environmental Planning and Assessment Act ENVIRONMENT AND PLANNING - exercising a function under the Environmental Planning and Assessment Act - respondent developer was not exercising a power, authority or duty directly conferred or imposed by the Act APPEAL - where primary judge in the Land and Environment Court erred in finding construction certificates were inconsistent with development consent - whether Court of Appeal can make findings to resolve the factual question - whether Court of Appeal can proceed assuming that factual finding to resolve question of law as to validity of challenged construction certificates
Legislation Cited:	Building Professionals Act 2005 (NSW) ss 5, 5A, 7, 8, 19, 21, 22, 31, 39, 40, 85, sch 3 Environmental Planning and Assessment Act 1979 (NSW) Environmental Planning and Assessment Amendment Act 1997 (NSW) Environmental Planning Legislation Amendment Act 2006 (NSW) Interpretation Act 1987 (NSW) s 9(2) Supreme Court Act 1970 (NSW) s 75A Trade Practices Act 1974 (Cth) s 75B Environmental Planning and Assessment Regulation 2000 (NSW) cll 139, 140, 142, 145, 147 Environmental Planning and Assessment Amendment (Miscellaneous) Regulation 2007 (NSW) Uniform Civil Procedure Rules 2005 (NSW) r 51.36
Cases Cited:	Bass v Permanent Trustee Co Limited [1999] HCA 9; 198 CLR 334 Botany Bay City Council v Saab Corp Pty Ltd [2011] NSWCA 308; 82 NSWLR 171 Burwood Council v Ralan Burwood Pty Ltd (No 2) [2014] NSWCA 179 Burwood Council v Ralan Burwood Pty Ltd [2013] NSWLEC 173 Coffs Harbour Environment Centre Inc v Minister for Planning (1994) 84 LGERA 324 El Cheikh v Hurstville City Council [2001] NSWLEC 175; 115 LGERA 425 Hare v Harmer [2009] NSWCA 68 Hillpalm Pty Limited v Heaven's Door Pty Limited [2004] HCA 59; 220 CLR 472 Kirk v Industrial Court of New South Wales [2010] HCA 1; 239 CLR 531 Lesnewski v Mosman Municipal Council [2005] NSWCA 99; 138 LGERA 207 Marvan Properties Pty Ltd v Randwick City Council [2005] NSWLEC 9; 138 LGERA 1 Minister Administering the Crown Lands Act v New South Wales Aboriginal Land Council (No 2) (1997) 42 NSWLR 641 Moy v Warringah Council [2004] NSWCCA 77; 133 LGERA 49 North Sydney Council v Moline (No 2) [2008] NSWLEC 169 Northern Residential Pty Ltd v Newcastle City Council [2009] NSWCA 141; 75 NSWLR 192 Prepaid Services Pty Ltd v Atradius Credit Insurance NV [2013] NSWCA 252 Progress & Securities Building Pty Ltd v Burwood Council [2008] NSWLEC 1178 Progress and Securities v Burwood Council [2006] NSWLEC 706 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 Smith v Wyong Shire Council [2003] NSWCA 322; 132 LGERA 148 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 Wilkie v Blacktown City Council [2002] NSWCA 284; 121 LGERA 444 Woods v Bate (1986) 7 NSWLR 560 Yorke v Lucas [1985] HCA 65; 158 CLR 661
Texts Cited:	Macquarie Dictionary Shorter Oxford English Dictionary
Category:	Principal judgment
Parties:	Burwood Council (Appellant) Ralan Burwood Pty Ltd (First Respondent) Lyall Ernest Dix (Second Respondent) John Morgan (Third Respondent) William Peter O'Dwyer (Fourth Respondent) The Owners - Strata Plan No. 88309 (Fifth Respondent)
Representation:	Counsel: TS Hale SC / SB Nash (Appellant) P Tomasetti SC / J Johnson (First to Fourth Respondents) Solicitors: Houston Dearn O'Connor (Appellant) Storey & Gough Lawyers (First to Fourth Respondents)
File Number(s):	2013/339576
Publication restriction:	None
Decision under appeal	Citation: [2013] NSWLEC 173 Date of Decision: 2013-10-16 00:00:00 Before: Sheahan J File Number(s): 40091 of 2013