Canterbury City Council v Daoud - [2007] NSWLEC 135

No judgment structure available for this case.

Land and Environment Court

of New South Wales

CITATION: Canterbury City Council v Daoud [2007] NSWLEC 135

PARTIES:
PROSECUTOR:
Canterbury City Council
DEFENDANT:
Robert Daoud

FILE NUMBER(S): 50033 of 2006

CORAM: Biscoe J

KEY ISSUES: Prosecution :- commencing erection of a buidling in accordance with development consent when construction certificate had not been issued, contrary to s 81A(2)(a) Environmental Planning and Assessment Act 1979 - plea of guilty - objective, subjective and mitigating circumstances.

LEGISLATION CITED: Environmental Planning and Assessment Act 1979, ss 125(1), 81A(2)(a), s 81A(7), s 109D(1)(b)
Crimes (Sentencing Procedure) Act 1999, s 10, ss 21A and 22

CASES CITED: Byres v Leichhardt Municipal Council [2006] NSWLEC 82;
Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698;
Carlino v Leichhardt Council (2005) 144 LGERA 235;
City of Sydney Council v Gravity Corporation Pty Limited [2001] NSWLEC 219;
Environmental Protection Authority v Hochtief AG [2006] NSWLEC 200;
Fairfield City Council v Cavasinni Constructions Pty Limited [2005] NSWLEC 187;
Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189;
Holroyd City Council v Katia Abouantoun & Anor [2003] NSWLEC 379;
Hornsby Shire Council v Symon [2003] NSWLEC 410;
North Sydney Council v Littlemore 132 LGERA 116;
North Sydney Council v Serafina (aka Phillip) Bianco [2005] NSWLEC 652 ;
R v Thompson (2000) 49 NSWLR 383

DATES OF HEARING: 1 March 2007

DATE OF JUDGMENT:
16 March 2007

LEGAL REPRESENTATIVES:
PROSECUTOR:
Mr T Howard, barrister
SOLICITORS
Pike Pike and Fenwick
DEFENDANT:
Ms A Pearman, barrister
SOLICITORS
Alexanders Lawyers

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

BISCOE J

16 March 2007

50033 of 2006

CANTERBURY CITY COUNCIL v ROBERT DAOUD
JUDGMENT

1 HIS HONOUR: This is the sentencing of the defendant Robert Daoud on a plea of guilty to a charge that from about September 2005 continuing up until 12 April 2006, at Campsie in NSW, he committed an offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (EPA Act), in that he commenced the erection of a building in accordance with a development consent when a construction certificate for the building work had not been issued by the consent authority or by an accredited certifier, which is forbidden by s 81A(2)(a) of the EPA Act.

2 Section 81A(2)(a) relevantly provides:

3 Section 109D(1)(b) of the EPA Act provides that a construction certificate may be issued by a consent authority, a council or an accredited certifier. Applications for construction certificates are regulated by the Environmental Planning and Assessment Regulation 2000 (EPA Regulation) Part 8 Division 2 (cl 139-148). Regulation 142(2) provides that the certifying authority must cause notice of its determination to be given to the consent authority and to the council within two days after the date of determination. The information and documents to accompany an application for a construction certificate are specified in Part 3 of Schedule 1 and the certifying authority may require further information: cl 139 - 140. The central purposes of a construction certificate are apparent from cl 145 which provides:

AGREED FACTS

4 The following facts were agreed between the parties.

5 On or about 8 April 2004, Canterbury City Council received a development application from Nerola Holdings Pty Ltd for a proposed development described as “block of 6 medium and 1 large townhouses with basement parking” on land comprising Lots 3 and 4 of section 7 in deposited plan 2922 known as 93-95 Clissold Parade, Campsie (“the subject property”).

6 A Statement of Environmental Effects accompanied the Development Application.

7 An Assessment Report of the Development Application was prepared by the Council’s professional staff, dated 30 September 2004.

8 A Notice of Determination dated 30 September 2004, granted development consent. Prominently displayed on the front page were the words: “BEFORE COMMENCING BUILDING WORK, you must obtain a Construction Certificate from the Council or an Accredited Certifier”. One of the conditions of the consent was that a Home Building (Private) Insurance Certificate “must be submitted either to Council or an Accredited Certifier prior to the issuing of a Construction Certificate”.

9 The defendant and Elias Daoud purchased the subject property in the first half of the calendar year 2005.

10 The subject property is zoned Residential 2(c) under the provisions of Canterbury Local Environmental Plan No 148 – Campsie Precinct.

11 On or about 1 March 2006, the defendant applied to the Council to modify the Development Consent. The Council granted the modification on 3 April 2006.

12 On 11 April 2006, Paul Rigon, a Development Assessment Officer of the Council, was provided with a letter from Peter Ruck of Sydney Building Approvals Centre (SBA) dated 23 February 2006. I note, however, that the council receipt date stamped on the letter is 27 February 2006. The letter stated “it has recently been brought to our attention that the above mentioned proposal has commenced building works without a Construction Certificate. Could you please investigate the above matter and advise of Council’s intended course of action. If you need to contact me please call me on [etc]”.

13 Later on 11 April 2006, Mr Rigon telephoned the defendant and had a conversation with him to the following effect:

14 At approximately 8.15am on 12 April 2006, Ross Jauncey, the Council’s Manager of Environmental Administration telephoned the defendant on his mobile phone and had a conversation to the following effect:

15 Mr Jauncey attended the subject property at approximately 9.00am on 12 April 2006 in the company of Ms Joanna Assad, a work experience student. He met the defendant there and they had a conversation to the following effect:

Mr Jauncey: My name is Ross Jauncey. This is Joanna Assad. Here is a stop work order.

Mr Jauncey: This Notice requires that you must immediately stop work on this site and sign the attached undertaking. You should read it carefully and get legal advice before you sign the undertakings.

16 Mr Jauncey then inspected the subject property and took a series of 20 digital photographs.

17 At the time of this inspection on 12 April 2006, construction works on the townhouses were nearing completion. At the front of the site there were two townhouses (each two-storey) that had a common wall at the centre of the site over a garage driveway that accessed an underground garage area. These two townhouses had been constructed to a point where the windows had been installed, the tile roofs completed and internal tiling on the stairs, laundry and bathroom were in progress. There were a further three townhouses (two-storey), on the eastern side of the block that had been constructed and completed to the same level of finish as the two front townhouses. At the rear of the subject property there were a further two townhouses (each two-storey) that had been completed, again to the same level of finish as the front two townhouses. The underground garage had also been constructed and was nearly completed. There were a number of landscape garden boxes constructed in the passageway that accessed the front doors of the 5 rear townhouses.

18 At the conclusion of the inspection Mr Jauncey had a further conversation with the defendant to the following effect:

19 A construction certificate has not been issued in relation to the construction of the townhouses on the subject property.

20 On 12 April 2006, the defendant applied for a building certificate in relation to the townhouses on the subject property. On 21 September 2006, the Council issued the defendant with a building certificate.

21 A construction certificate and an occupation certificate were about to be issued to the defendant as at the date of the hearing before me.

THE DEFENDANT’S AFFIDAVIT EVIDENCE

22 The defendant swore an affidavit in which he gave the following evidence, which I accept.

23 He has been a property developer for some 17 years, since approximately 1994. He has always sought and obtained building applications or construction certificates from either council or a private certifier, (SBA)), on each of the eight properties he has previously developed.

24 In relation to the development the subject of the charge, in May 2005 his brother and he purchased the property from Nerola Holdings Pty Limited. Nerola lodged with Canterbury City Council a development application for a proposed development described as six medium and one large townhouse with basement parking.

25 In or about July 2005, he lodged an application for a construction certificate with SBA, which he has used as the private certifier on three of his previous developments. On 20 July 2005, SBA wrote to him advising that certain further information, including home owners warranty insurance, was required to be submitted. He provided what he believed to be all the necessary information requested to SBA in late August 2005. The defendant did not believe that he was required to provide home owners warranty insurance because the property was a commercial development over three storeys. He understood that such a property was exempt from such insurance.

26 In or about late August 2005, he telephoned SBA in relation to the status of the construction certificate application. He was quoted a construction certificate number over the telephone, CC 306/05. The SBA staff member told him that, “All documents are being finalised. If we require anything further we’ll contact you”.

27 In early September 2005, bulk excavation commenced at the property. By this time, as he had not heard further from SBA, he was under the impression that the construction certificate (306/05) had issued for the property.

28 Between late September and late December 2005, the defendant suffered difficulties, including: a broken foot, which required surgery and a plaster; his wife was hospitalised for three weeks from late November; and from late November until mid December he cared for their three children, two of whom were at primary school and the youngest was at home with him. During this period he was occupied with domestic duties and travelling to hospital each day. He controlled the building site via telephone with the occasional visit.

29 In mid to late December a council ranger notified him that a permit was required to operate a crane for a concrete boom pump. The defendant immediately approached council and obtained the necessary permit. All subsequent inspections for footings, slabs and block walls were made by the structural engineer for the property.

30 In mid February 2006, he telephoned SBA to arrange a roof inspection. Mr Ruck returned his call. He told Mr Ruck “we’re ready for a roof inspection. When would you be able to come out and do it?” Mr Ruck told him, SBA had not issued a construction certificate for the property and that he required home owners warranty insurance because the development was classified as two-storey, not a three-storey development. He was told that the sub-floor basement could not be classified as a storey. He told Mr Ruck that he was under the impression that a construction certificate had been issued in last August by one of SBA’s staff and that he was quoted CC 306/05. Mr Ruck told him that that would have been the construction certificate application number and that he had to get a building identification survey and then a building certificate from the council for the works already done.

31 A letter dated 26 July 2006 from SBA, detailed all documents he supplied to the certifier. On 9 April 2006, he secured home warranty insurance for the property.

32 On or about 28 February 2006, he lodged an application with the council to modify the development consent to alter the building. Council granted consent to the modification on 3 April 2006.

33 On 12 April 2006, he was served with a council notice of demand to stop work. He complied with the council’s request to inspect the property and take photographs. He asked the council officer whether the matter could be resolved with a small fine but was told no, the on the spot fine was for issues of a minor nature. He asked this question because he was aware that an on-the-spot fine of $500 for another development had been reduced by the Burwood Local Court to $200.

34 On 12 April 2006, he received the building identification survey. It had taken his surveyor approximately two months to do the survey. The next day he lodged an application with council for a building certificate for the works already performed. He has complied with all council’s requests to give them various documents relating to the building application. Council issued a building certificate for the property on 22 September 2006.

35 During the five months he was unable to work on the property, his additional interest payments on his loan facility amounted to some $70,000, equating to approximately $12,000 per month. This was in addition to the usual expenses incurred on such developments including holding costs, council rates, water rates, insurance and land tax. The stop work has also caused a significant delay in the sale of the units.

36 The defendant is truly sorry that he made a mistake in respect of his understanding that a construction certificate had issued for the property. This has not occurred on any of his previous developments. He is aware that securing a construction certificate is his responsibility. He is embarrassed that the mistake has occurred. He notes that it has already cost him dearly.

37 To ensure that the mistake does not occur again he is committed to taking greater care in the future and has decided to use council as his principle certifying authority for any further construction certificates.

38 He has no criminal record. He has agreed to pay the prosecutor’s costs in the matter.

THE DEFENDANT’S ORAL EVIDENCE

39 The defendant’s evidence in cross examination included the following:

a He did not inform the council that he did not have a construction certificate until 12 April 2006.

b Construction continued between mid February 2006, when Mr Ruck informed him that no construction certificate had issued, and 12 April 2006, when he was served with a stop work order by the council. The reason, he said, was that in his conversation with Mr Ruck in February 2006, he asked Mr Ruck whether he could continue construction and Mr Ruck told him that he could.

c He should have been aware that he did not have a construction certificate, given that he had been in the development business for 17 years.

d Although the certificate of home insurance in evidence is dated 9 April 2006, he in fact applied for it a month or so earlier, in February or March.

40 It is surprising that Mr Ruck would have told the defendant in February 2006 that he could continue with construction, although perhaps that is given some credence by the terms of his letter of 23 February 2006 to the council. It is also surprising that this is not mentioned in the defendant’s written evidence. I see no legal justification for the advice. However, the defendant’s evidence on this point was not challenged and I am prepared, with some hesitation, to accept that this is what Mr Ruck told him. In addition, I accept the remainder of the defendant’s oral evidence to which I have referred.

REFERENCES

41 Three references were provided, which I accept:

a Mr Peter Ruck, building surveyor of SBA, stated that the defendant had lodged several construction certificate applications with SBA over the last six years and had on all previous occasions obtained construction certificate approval prior to construction of works on site.

b N Lycenko stated that he had been associated professionally with the defendant as his architect in the planning, documentation and site inspection of a number of projects ranging from single dwellings to medium density developments over a period of eight years. He has found him to be reliable, honest and a person with exceptional skills in site management and construction techniques, with particular attention to regulatory compliances and other matters in which his involvement and contribution resulted in successful developments. He has no hesitation in recommending the defendant as a person of the highest integrity who strives to produce a product of quality and longevity.

c Kerry Loizou met the defendant nine years ago as his accountant; has dealt with him professionally and personally and they have become good family friends; describes the defendant as a very honest and hard working loyal family man; and has a great deal of respect for him.

DISCUSSION

42 The Court is required to take into account the aggravating, mitigating and other factors referred to in ss 21A and 22 of the Crimes (Sentencing Procedure) Act 1999; however, they are not exhaustive of the matters which the Court must take into account. None of the aggravating factors referred to in s 21A (2) apply in the present case.

43 The objective circumstances of the offence to which the Court must have regard include the maximum penalty, the need for general deterrence, the objective harmfulness of the defendant’s actions, the defendant’s state of mind in committing the offence, and the reasons for committing the offence.

44 The maximum penalty is $33,000: s 81A(7) of the EPA Act. That provision was inserted in the Act in 2003. It is remarkable because the maximum penalty generally for offences against the EPA Act is $1.1 million: s 126. The maximum penalty available for an offence reflects the public expression of Parliament of the “seriousness of the offence”: Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698. Relatively speaking, therefore, this offence appears to be regarded by Parliament as less serious than other offences under the EPA Act.

45 There is a need for general deterrence in order to maintain the integrity of the construction certificate system, particularly given the council’s loss of control when private certifiers are used. However, in the present case, that principle was weakened by the council’s own apparent failure for almost two months to respond to Mr Ruck’s letter of 23 February 2006, notifying that work had commenced without a construction certificate and asking council to investigate and advise of its intended course of action.

46 As regards the objective harmfulness of the defendant’s action, there is no suggestion that the defendant carried out works other than in accordance with the approved plans. This is not a case where the absence of a construction certificate went hand in hand with divergence from the approved development or relevant requirements of the Building Code of Australia, see cl 145 of the Regulation.

47 There are two factors, which make the case somewhat more serious, although there are mitigating circumstances. The first is that the defendant, as an experienced developer, should have been aware, and indeed was aware, that it was necessary to obtain a construction certificate. Although he believed that a construction certificate had issued based upon his conversation with the SBA officer in August 2005, as an experienced developer he should have been put on inquiry when he did not physically receive the construction certificate. This is mitigated by the distracting health and domestic problems that enveloped him and his family for the remainder of that year. The second factor is that construction continued for two months after the defendant was informed in mid February 2006 that he was in error in thinking that a construction certificate had issued. This is mitigated to some extent by the fact that, according to his oral evidence, he was told by Mr Ruck of SBA that he could continue with construction, and by the fact that the council did not respond for almost two months to Mr Ruck’s letter of 23 February 2006 asking council to investigate and advise its intended course of action.

48 Although I take into account these mitigating circumstances, I do not accept that it was entirely reasonable for the defendant to have believed prior to mid February 2006 that a construction certificate had issued or to have believed from mid February 2006 that he was permitted to proceed with construction. As an experienced developer, he cannot shed responsibility entirely by pointing to reliance on others. He must have known that the development consent itself required him to obtain a construction certificate before commencing construction.

49 The relevant subjective facts include: the defendant has no prior conviction; he has a good character; he (is in my view) unlikely to re-offend; he pleaded guilty at the first available opportunity; he has shown contrition and remorse; and he has cooperated with the council including in relation to the preparation of a statement of agreed facts. In addition, he has agreed to pay the prosecutor’s costs in the agreed sum of $11,000 and has paid dearly for his mistake in terms of delay in the completion of the project and holding charges exceeding $70,000.

50 The utilitarian value of a plea of guilty was assessed in the range of 10 to 25 percent on sentence in the guideline judgment of the Court of Criminal Appeal in R v Thompson (2000) 49 NSWLR 383:

[155] The top of the range would be expected to be restricted to pleas at the earliest possible opportunity and should not be given, save in an exceptional case, after a matter has been set down for trial. A discount towards the bottom of the range is appropriate for late pleas, for example, on the date fixed for trial, unless there are particular benefits arising from the prospective length and complexity of the trial.

[156] Rare cases involving exceptional complexity and trial duration may justify a higher discount. In some cases no discount is appropriate at all. In some cases the discount will be reflected in a step down in the hierarchy of sentencing options.

[157] There are circumstances in which the protection of the public requires a long sentence to be imposed so that no discount for the plea is appropriate: see, eg, R v Stabler (1984) 6 Cr App R (S) 129 at 131; R v Costen (1989) 11 Cr App R (S) 182 at 184.

[158] There are crimes that so offend the public interest that the maximum sentence, without any discount for any purpose, is appropriate. This includes situations in which a life sentence can be and is imposed, notwithstanding the plea: see, eg, R v Kalache [2000] NSWCCA 2; see especially per Sully J (at [38]-[42]).

[159] It is also pertinent to state that a discount of 10-25 per cent is not a range within which trial judges may exercise a discretion that will not be subject to appellate review. Appeals against severity or leniency of sentence focus on the range which is appropriate for the particular case, not on the range appropriate for pleas in the full variety of circumstances:

Conclusion:

51 In Environmental Protection Authority v Hochtief AG [2006] NSWLEC 200 at [83] I said:

Generally, the timing of a plea of guilty is the primary consideration determining the utilitarian benefit of a guilty plea and, therefore, where in the discount range a particular case should fall. But it is not the only consideration. Other considerations are complexity of issues; difficulty in assembling evidence; and the potential length and complexity of a fully contested trial. In the present case these other considerations do not seem to be as weighty as in some other criminal cases, including criminal cases outside the jurisdiction of this Court.

52 The last comment also applies, I think, to the present case. However, since the prosecutor and the defendant both submitted that there should be a full 25 percent discount for the early plea of guilty and as the matter has not been fully argued, I am prepared to accede to that submission.

53 The parties referred me to a number of sentencing authorities including Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189, Carlino v Leichhardt Council (2005) 144 LGERA 235, Holroyd City Council v Katia Abouantoun & Anor [2003] NSWLEC 379, Byres v Leichhardt Municipal Council [2006] NSWLEC 82, City of Sydney Council v Gravity Corporation Pty Limited [2001] NSWLEC 219, Fairfield City Council v Cavasinni Constructions Pty Limited [2005] NSWLEC 187, Hornsby Shire Council v George Symon [2003] NSWLEC 410, North Sydney Council v Littlemore 132 LGERA 116, and North Sydney Council v Serafina (aka Phillip) Bianco [2005] NSWLEC 652. I have found these authorities to be of limited assistance because of the unique facts and circumstances of the present case.

54 An application was made under s 10 of the Crimes (Sentencing Procedure) Act 1999, which provides that, without proceeding to a conviction, the Court may dismiss a charge or conditionally discharge a person guilty of an offence. I do not consider that this is an appropriate case in which to make an order under s 10.

55 I provisionally determine by reference solely to the objective circumstances of the case, that the fine should be $10,000. In all the circumstances of the case, I discount that sum by 50 percent to take into account the mitigating circumstances to which I have referred, including for the early plea of guilty. Accordingly, I propose to fine the defendant $5,000.

ORDERS

56 I make the following orders:

1. The defendant is convicted of the offence charged.

2. The defendant is fined the sum of $5,000.

3. The defendant is to pay the prosecutor’s costs agreed in the sum of $11,000.

4. The exhibits may be returned.

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Citations

Canterbury City Council v Daoud [2007] NSWLEC 135

Most Recent Citation

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Campbelltown City Council v Mhanna [2010] NSWLEC 57

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CITATION:	Canterbury City Council v Daoud [2007] NSWLEC 135
PARTIES:	PROSECUTOR: Canterbury City Council DEFENDANT: Robert Daoud
FILE NUMBER(S):	50033 of 2006
CORAM:	Biscoe J
KEY ISSUES:	Prosecution :- commencing erection of a buidling in accordance with development consent when construction certificate had not been issued, contrary to s 81A(2)(a) Environmental Planning and Assessment Act 1979 - plea of guilty - objective, subjective and mitigating circumstances.
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979, ss 125(1), 81A(2)(a), s 81A(7), s 109D(1)(b) Crimes (Sentencing Procedure) Act 1999, s 10, ss 21A and 22
CASES CITED:	Byres v Leichhardt Municipal Council [2006] NSWLEC 82; Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698; Carlino v Leichhardt Council (2005) 144 LGERA 235; City of Sydney Council v Gravity Corporation Pty Limited [2001] NSWLEC 219; Environmental Protection Authority v Hochtief AG [2006] NSWLEC 200; Fairfield City Council v Cavasinni Constructions Pty Limited [2005] NSWLEC 187; Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189; Holroyd City Council v Katia Abouantoun & Anor [2003] NSWLEC 379; Hornsby Shire Council v Symon [2003] NSWLEC 410; North Sydney Council v Littlemore 132 LGERA 116; North Sydney Council v Serafina (aka Phillip) Bianco [2005] NSWLEC 652 ; R v Thompson (2000) 49 NSWLR 383
DATES OF HEARING:	1 March 2007
DATE OF JUDGMENT:	16 March 2007
LEGAL REPRESENTATIVES:	PROSECUTOR: Mr T Howard, barrister SOLICITORS Pike Pike and Fenwick DEFENDANT: Ms A Pearman, barrister SOLICITORS Alexanders Lawyers