Cavasinni Constructions Pty Ltd v Fairfield City Council

[2010] NSWLEC 65

Land and Environment Court

of New South Wales

CITATION:

Cavasinni Constructions Pty Ltd v Fairfield City Council [2010] NSWLEC 65

PARTIES:

APPLICANT
Cavasinni Constructions Pty Ltd

RESPONDENT
Fairfield City Council

FILE NUMBER(S):

10799 of 2009

CORAM:

Craig J

KEY ISSUES:

APPEAL :- s 56A appeal - appeal against decision of commissioner on question of law – validity of condition for creation of right of carriageway – application of s 80A(1)(a) – primacy of legislation – necessity to consider statutory language before turning to judicial consideration of associated principles – consideration of the Newbury tests in the context of the statutory provision.

APPEAL :- s 56A appeal - appeal against decision of commissioner – procedural fairness – discretion of commissioner exercised on a basis not addressed by the parties and not identified at the hearing – no opportunity given to the parties to address the basis for exercise of discretion adopted by the commissioner – denial of procedural fairness.

LEGISLATION CITED:

Environmental Planning and Assessment Act 1979
Land and Environment Court Act 1979

CASES CITED:

Arkibuilt Pty Ltd v Ku-ring-gai Council [2006] NSWLEC 502; 148 LGERA 85
Azzopardi v Tasman UEB Industrial Ltd (1985) 4 NSWLR 139
Brimbella Pty Ltd v Mosman Municipal Council (1985) 79 LGERA 367
Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 239
Cavassini Constructions Pty Ltd v Fairfield City Council [2009] NSWLEC 1320
Plaintiff S157/2002 v Commonwealth of Australia [2003] HCA 2; 211 CLR 476
Design Power Associates Pty Ltd v Willoughby City Council [2005] NSWLEC 470; 148 LGERA 233
Dogild Pty Ltd v Warringah Council [2008] NSWLEC 53; 158 LGERA 429
Fairfield City Council v N & S Olivieri Pty Ltd [2003] NSWCA 41
Hope v Bathurst City Council (1980) 144 CLR 1
Lake Macquarie City Council v Hammersmith Management Pty Ltd [2003] NSWCA 313; 132 LGERA 225
McGregor v Bathurst City Council [1995] NSWLEC 71
Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259
Monaldo Pty Ltd v Baulkham Hills Shire Council [1995] NSWLEC 165
Newbury District Council v Secretary of State for the Environment [1981] AC 578
Parramatta City Council v Peterson (1987) 61 LGRA 286
Progress and Securities Pty Ltd v North Sydney Municipal Council (1988) 66 LGRA 236
Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 [2003] HCA 30
Segal v Waverley Council [2005] NSWCA 310; 64 NSWLR 177
Shao v Hornsby Shire Council [2001] NSWLEC 254; 116 LGERA 462
Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; 156 LGERA 150
Walker Corporation Pty Limited v Sydney Harbour Foreshore Authority [2008] HCA 5; 233 CLR 859
Western Australian Planning Commission v Temwood Holdings Pty Ltd [2004] HCA 63; 221 CLR 30

DATES OF HEARING:

15 March 2010

 
DATE OF JUDGMENT: 

30 April 2010

LEGAL REPRESENTATIVES:

APPLICANT
Ms Sandra Duggan, barrister
Instructed by Ms M Antunes of
Antunes Lawyers and Advocates

RESPONDENT
Mr AJJ Thompson, solicitor of
Ritchie & Castellan Solicitors & Notaries

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

CRAIG J

30 APRIL 2010

09/10799 CAVASINNI CONSTRUCTIONS PTY LTD v FAIRFIELD CITY COUNCIL

JUDGMENT

1 HIS HONOUR: On 22 October 2007, Cavassini Constructions Pty Ltd (Cavasinni) obtained development consent to carry out additions to an existing building on land known as 685-687 The Horsley Drive, Smithfield (the site). The additions principally related to that part of the building which for some years past had been used as a restaurant.

2 Subsequently, Cavasinni made application to Fairfield City Council (the Council) pursuant to s 96 of the Environmental Planning and Assessment Act 1979 (the EPA Act) to modify the 2007 development consent in several respects. Among the modifications sought was the deletion of condition 3(a) to that consent which required the creation of a right of carriageway across the site so as to provide rear lane access to properties located to its east. The Council refused to accede to any of the modifications sought, with the result that Cavassini appealed to this Court pursuant to s 96(6) of the EPA Act.

3 The appeal was heard by a commissioner of the Court who, on 1 October 2009, upheld the appeal so far as it related to some of the modifications sought but refused to delete condition 3(a) (Cavassini Constructions Pty Ltd v Fairfield City Council [2009] NSWLEC 1320). It is from the refusal so to do that Cavasinni appeals pursuant to s 56A of the Land and EnvironmentCourt Act 1979 (the Court Act).

4 I have determined that Cavasinni’s appeal should be upheld and the matter remitted to the commissioner for determination in accordance with these reasons. The Council should pay the cost of this appeal but each party should pay its own costs of the hearing that has already taken place before the commissioner.

The application under s 96 of the EPA Act

5 As I have already stated, the development consent which Cavasinni sought to have modified was a conditional consent granted by the Council on 22 October 2007 (the consent). It sanctioned additions to the building so as to provide a new dining area, entry and office for an existing restaurant. The building is located within the business centre of Smithfield.

6 The site is a rectangular allotment having frontage to the The Horsley Drive on its southern boundary. It runs lengthwise from that road on an approximate north-south axis. Pedestrian access is available to the building on the site from The Horsley Drive, which runs in an east-west direction. At the rear of the building on the site is a significant area of land which is presently used for parking. Access to that parking area as well as access for vehicles servicing the building is gained via a lane known as Stein Lane. That lane runs parallel to The Horsley Drive from the west and terminates at the western boundary of the site. It does so at a location that is approximately equidistant between the northern and southern boundaries of the site.

7 Condition 3(a) of the development consent required the creation and registration of a right of carriageway 7.315m wide across the site for the benefit of three identified properties located to its east. The plan identified in that condition required that the location of the right of carriageway be such as to provide an extension of Stein Lane across the site to the east.

8 In addition to seeking modification of the development consent by deletion of condition 3(a), Cavasinni also sought to modify the consent by deletion of other conditions and, as well, sought to alter the external treatment of the proposed additions. It is unnecessary to refer to the detail of these other matters as the substance of the issues in relation to them was resolved between the parties, subject only to the commissioner determining the terms of conditions upon which agreement could not be reached.

9 Relevantly, the notice of determination issued by the Council, refusing Cavasinni’s modification application, stated as a reason for refusal:

“1. The proposed development (sic) seeking the deletion of condition 3(a) of the consent would not result in an orderly development of Stein Lane in that the development would not provide for the proposed extension of Stein Lane and access to adjacent and adjoining properties (Environmental Planning and Assessment Act 1979 s 79C(1)(b)).”

The commissioner’s decision

10 The structure of the commissioner’s judgment is unexceptional. After reciting the background to the appeal and the issues tendered for determination, the focus of the factual findings and consideration of principle is upon the debate that attended the imposition of condition 3(a). There are then two conclusions, critical for present purposes, that are expressed in relation to that condition. First, after reviewing the statements of principle pertaining to the imposition of conditions of consent, as articulated in Newbury District Council v Secretary of State forthe Environment [1981] AC 578, and further discussed by Biscoe J in Dogild Pty Ltd v Warringah Council [2008] NSWLEC 53; 158 LGERA 429, the commissioner determined that the condition was “fair and reasonable in the circumstances of this case” (at [23]).

11 Secondly, having also determined that the development to which the consent as modified relates would be substantially the same development as that for which the consent was granted in October 2007 ([26] – [27]), the commissioner then turned to consider the discretion conferred by s 96. The history of development consents for restaurant use of the site was recited, as was the history of the Council’s proposal for extension of Stein Lane and the acceptance of conditions of the kind contained in condition 3(a) upon subdivision and development of other parcels of land adjoining the subject site. The principles of ‘benefit and burden’ enunciated in Progress and Securities Pty Ltd v North Sydney Municipal Council (1988) 66 LGRA 236 and Monaldo Pty Ltd v Baulkham Hills Shire Council [1995] NSWLEC 165 were, in terms, applied to those facts. The commissioner concluded that in the exercise of the discretion available under s 96, the consent should not be modified by deleting condition 3(a).

The 56A appeal: grounds of appeal

12 Cavasinni acknowledges that in order to sustain its appeal it must demonstrate error on the part of the commissioner when determining a question of law. By its summons commencing this appeal, Cavasinni identifies three grounds upon which it asserts that the commissioner’s judgment was erroneous on questions of law. They may be stated as follows:

(i) in determining that condition 3(a) was validly imposed pursuant to s 80A(1) of the EPA Act, the commissioner failed properly to consider the provisions of that section and further misapplied the second of the Newbury tests in so determining;
(ii) the commissioner failed to afford procedural fairness to Cavassini in that the Progress and Securities and Monaldo principles of ‘benefit-burden’, as a basis upon which to exercise discretion, was not a basis identified at the hearing either by the parties or the commissioner;
(iii) the determination by the commissioner that there was a nexus between the development, the subject of the development consent and condition 3(a) was manifestly unreasonable.

13 It is convenient to consider each of these grounds of appeal in turn.

Ground 1: the validity of condition 3(a)

14 The essence of Cavasinni’s submission is that condition 3(a) is a condition the imposition of which is not authorised by the EPA Act. The commissioner determined that it was so authorised. Whether there was power on the part of the Council or the Court to impose the condition, as was held to be the case by the commissioner, clearly raises a question of law.

15 As I have indicated, Cavassini mounts its challenge to the validity of condition 3(a) on two related bases. The first is by reference to s 80A(1)(a) of the EPA Act. It submits that the relevant provisions of this section were not addressed by the commissioner when determining the validity of the condition. Secondly, Cavassini submits that the commissioner misconstrued or misapplied the second of the tests articulated by the House of Lords in Newbury for the validity of a condition of development consent.

16 Section 80A(1) of the EPA Act relevantly provides as follows:

“ 80A imposition of conditions
(1) Conditions - generally
A condition of development consent may be imposed if:
(a) it relates to any matter referred to in s 79C(1) of relevance to the development the subject of the consent … “ (emphasis added)

17 Properly analysed, it seems to me that s 80A(1)(a) requires two matters to be addressed. The first is whether the condition relates to a matter referred to in s 79C(1) and the second requires a determination as to whether such matter is relevant to the particular development for which development consent has been or is proposed to be granted. Whilst I eschew a ‘fine-tooth-comb’ approach to the reasons for decision of the commissioner (Brimbella Pty Ltd v Mosman Municipal Council (1985) 79 LGERA 367 at 368; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 291), I am unable to discern from those reasons that these questions have been addressed by reference to the subsection. Nowhere is the “matter referred to in s 79C(1) of relevance to the development” identified.

18 Nonetheless, critical findings of fact relevant to address the requirements of the subsection were made. These findings of fact may be summarised as follows:

(i) The extension of Stein Lane has been a policy of the Council since 1962, it being part of that policy to acquire the area comprising the proposed right of carriageway identified in condition 3(a) as land to be dedicated as a public road. The site of the proposed right of carriageway across the site is the last section of land to be provided in order to implement the Council’s long standing policy (at [15]).
(ii) No document evidencing that policy has been placed on public exhibition, nor has there been consultation with “stakeholders” concerning that policy (at [15]).
(iii) The site (and presumably the lane as it presently exists) can accommodate all traffic and vehicle movements generated by activities upon it and there is no need for those vehicles to travel east of the site (at [15]).
(iv) The present needs of the site for access by service and delivery vehicles as well as access for customers are met without any necessity to create the right of carriageway intended by condition 3(a) (at [23]).
(v) By extending Stein Lane through the site via the right of carriageway required to be created by condition 3(a), the provision of services and deliveries to and from those properties located to the east of the site and which only have frontage to the The Horsley Drive will be facilitated, thus avoiding the present arrangement whereby those properties can only be serviced from the The Horsley Drive (at [19]).
(vi) The construction of a road along the site of the proposed right of carriageway, together with the ramp necessary to continue access from the site to the rear of properties located to its east, will not give rise to any detriment to the movement of vehicles into the car parking area on the site. Further, the extension of the restaurant presently authorised by the development consent is achievable, even with the right of carriageway created, so that there is no “private detriment” arising from a denial of opportunity to redevelop the existing premises in the manner presently intended (at [23]).

19 It was in the context of these findings of fact that the questions which I have earlier identified as arising from s 80A(1) needed to be addressed. When so addressed, those findings seem to me to place condition 3(a) beyond the reach of the empowering statutory provision. By reference to s 79C(1) -

(i) none of the instruments or documents identified in paragraph (a) of that subsection were identified as being relevant;
(ii) no impacts of the development authorised by the development consent were identified as justifying the imposition of condition 3(a), there being no access or vehicle movement issue arising from the implementation of the approved development (s 79C(1)(b));
(iii) no issue was identified that could sustain a condition by reference to paragraphs (c) and (d) of s 79C(1); and
(iv) the broader public policy of seeking to improve rear lane access for properties to the east of the subject site could not justify condition 3(a) taking account of “the public interest”, as that expression is used in paragraph (e) of s 79C(1).

20 It can be accepted that there was a general public interest in implementing the Council’s policy of providing rear lane service access to business premises having frontage to The Horsley Drive at Smithfield. Such access was already available to the site. However, that public interest does not extend to justifying a condition requiring provision for the extension of Stein Lane across the site, given the qualifying word in s 80A(1)(a) that the implementation of that policy be “of relevance to the development the subject of the consent.” Of course, it is open to the Council to acquire the relevant interest in the site so as to implement its policy.

21 At [17] of the judgment, the commissioner identified s 80A(1), particularly paragraph (a) of that subsection, as being the source of power to impose condition 3(a). However, having identified the section, the reasoning proceeds immediately to a consideration of Newbury. While the tests in Newbury have some relevance to a consideration of the exercise of the power in the subsection, it seems to me that the statutory provision first required analysis and application in the context of the facts found before proceeding to a consideration of those tests. When addressing the validity of a condition, attention must first be given to the statutory provision which is the source of power to impose conditions before turning to a consideration of judicial exegesis of provisions which are not, in terms, those that inform the power being considered (Walker Corporation Pty Limited v Sydney Harbour Foreshore Authority [2008] HCA 5 at [29] – [35]; 233 CLR 259).

22 In Lake Macquarie City Council v Hammersmith Management Pty Ltd [2003] NSWCA 313; 132 LGERA 225, Tobias JA (Mason P and Young CJ in Eq agreeing) held (at [52]) that the Newbury tests were additional to the requirements of the statutory phrase “will or is likely to require the provision of or increase the demand for public amenities and public services within the area”, as that phrase is expressed in s 94(1) of the EPA Act. His Honour articulated the position in the following terms:

“In my opinion, a condition can only be validly imposed pursuant to s 94(1) if:

(a) one or other of the limbs of the statutory phrase is satisfied;
(b) the condition satisfies the Newbury test … ”.

By parity of reasoning, I am of the opinion that condition 3(a), in order to be valid, must be shown to engage the provisions of s 80A(1)(a) and, so far as is necessary to address the language of the section, also satisfy the Newbury tests.

23 Cavasinni accepted that the first of the Newbury tests for the determination of a valid condition was satisfied in the present case. Condition 3(a) was imposed in fulfilment of a planning purpose, namely the provision of rear lane service access for properties located to the east of the subject site, thereby avoiding the undesirable servicing of those properties from a main thoroughfare, namely The Horsley Drive. It was the second of the Newbury tests upon which the commissioner focused. After referring to the first test, Lord Fraser articulated the second test in Newbury in the following terms (at 607G):

“Second, it must relate to the permitted development to which it is annexed. The best known statement of these two tests is that by Lord Denning in Pyx Granite Co Limited v Ministry of Housing and Local Government [1958] 1 QB 554 which has been followed and applied in many later cases. Lord Denning said at p 572:
‘Although the planning authorities are given very wide powers to impose such conditions as they think fit , nevertheless the law says that those conditions, to be valid, must fairly and reasonably relate to the permitted development.’ (Emphasis added.)

It is to be noticed that although often referred to as the second Newbury test , the phrase “fairly and reasonably relate … ” is, in the words of Lord Fraser, an appropriate statement of the first two tests.

24 It was upon the phrase that the condition “must fairly and reasonably relate to the permitted development” that the commissioner founded the ultimate decision. Such focus may provide an appropriate judicial gloss upon, or exposition of, the word “relates”, as that word appears at the commencement of paragraph (a) of s 80A(1) but, in so doing, sight cannot be lost of the remaining provisions of the paragraph to which I have earlier drawn attention. The paragraph mandates consideration of the two questions I have earlier identified.

25 When considering the second of the Newbury tests, the commissioner did so substantially by reference to the discussion of that test by Biscoe J in Dogild. Particular emphasis was given to his Honour’s discussion of the phrase “fairly and reasonably relate” in [51] and [52] of that judgment. However, my reading of his Honour’s judgment does not reveal that he was called upon to consider separately the application of the provisions of s 80A(1)(a) from the application of the tests in Newbury. That may well have come about by reason of the manner in which the issues were ultimately framed for his determination (see [1] of that judgment).

26 In my opinion full effect can be given both to the statutory provision and to the Newbury tests if subsection (1)(a) of s 80A is considered as if it read:

“A condition of development consent may be imposed if it fairly and reasonably relates to any matter referred to in s 79C(1) of relevance to the development the subject of the consent.”

Thus, the condition under challenge must be shown to be both fair and reasonable as it relates to a matter identified in s 79C(1). It must also be shown to be “of relevance” to the development the subject of the consent.

27 As I have earlier indicated, the commissioner focused upon the second Newbury test as that test was discussed by Biscoe J in Dogild. At [51], Biscoe J addressed the phrase “fairly and reasonably relate” by reference to the meaning attributed to it by Callinan J in Western Australian Planning Commission v Temwood Holdings Pty Ltd [2004] HCA 63; 221 CLR 30 where at [155] it was stated that for a condition to fairly and reasonably relate to the proposed development “it must be a condition, not simply justifiable as one which a reasonable planning authority could impose, but one which is fair and reasonable in the circumstances of the particular case.”

28 Biscoe J then proceeded at [52] to discuss the well known dictum of Stein J in Parramatta City Council v Peterson (1987) 61 LGRA 286. In that case his Honour stated (at 296):

“In my opinion the second test of whether the condition fairly and reasonably relates to the permitted development is not answered simply by geographical proximity but rather whether the development is benefited by the public amenity provided. There is no doubt that it must benefit … even though the benefit may not be a direct one … ”.

There, Stein J rejected a “direct connection” test as being applicable.

29 Although the dictum in Peterson was directed to a condition imposed pursuant to s 94 of the EPA Act, its applicability to a condition which was not so founded was determined in this Court in McGregor v Bathurst City Council [1995] NSWLEC 71. In that case, the principle was applied in the context of a “broad approach”, enquiring only whether the development in question derives some benefit, however indirect, by the condition imposed.

30 More recently, the dictum of Stein J in Peterson was considered and explained in Lake Macquarie City Council v Hammersmith Management Pty Ltd. The need for “benefit” was acknowledged as was the need to consider the provision of benefit in the context of the statutory power which authorised the imposition of the condition in question. That approach is apposite to the approach that I have articulated in relation to s 80A(1).

31 Having considered the authorities to which I have just referred and discussed, Biscoe J in Dogild concluded at [52] of his judgment by saying:

“Although this line of authority indicates that such a benefit is sufficient to satisfy the second Newbury test, it may not be inconsistent to envisage cases where a condition is fair and reasonable in the circumstances of a particular case (to use Callinan J’s description) even if it does not benefit the permitted development.”

It was in reliance upon this sentence that the commissioner determined condition 3(a) to be “fair and reasonable in the circumstances of this case” and thus its validity sustained. So much is made clear at [23] of the judgment where the following is stated:

“The requirement is that the condition be fair and reasonable in the circumstance of a particular case, and it may be that a condition is fair and reasonable in the circumstance of a particular case even if it does not benefit the permitted development.”

32 This statement is made in the context of the commissioner acknowledging the facts that I have earlier summarised (see [18]) and then proceeding to identify the limited disadvantage that would be imposed upon the user of the site when compared to the disadvantages to the landowner identified by Biscoe J on the facts considered by him in Dogild. The commissioner does not identify any benefit, no matter how indirect, which the development the subject of consent would derive from the imposition of condition 3(a). Although reference is made in [23] to “some advantage” in vehicles being able to use a turning area proposed for the east of the site, thereby enabling them to leave Stein Lane in a forward direction, that “advantage” is not identified as being one that is not presently able to be enjoyed by vehicles servicing or resorting to the present site. Fundamentally, the approach taken by the commissioner seems to have been an absence of real detriment to the user of the site by imposition of the condition.

33 In the context of long standing authority, including those cases to which Biscoe J referred and analysed in Dogild, the need for a nexus between the condition proposed and the development for which consent has been granted was a fundamental consideration. While no authority is cited by Biscoe J for the observation made in the final sentence of [52] of his judgment, I do not interpret it as meaning that the second Newbury test can be satisfied even if there is not a relevant nexus between condition and development. Ordinarily, that nexus will be established if benefit, even though indirect, is demonstrated. I take his Honour to be indicating that there may be circumstances in which the nexus can be demonstrated by some means other than benefit. However, it is only after a relevant nexus is demonstrated that one can consider or balance advantages and disadvantages to the development in question by the imposition of the condition under consideration.

34 The error of the commissioner in this context was going directly to consideration of the advantages and disadvantages of the condition, if implemented, without first identifying the nexus between the development authorised by the consent under consideration and condition 3(a). So much is required both by the provisions of s 80A(1)(a) and the proper application of the Newbury tests. The incorrect determination that the facts found by the commissioner satisfied the statutory provision involves error in determining a question of law (Hope v Bathurst City Council (1980) 144 CLR 1 at 7).

35 For all of these reasons, I uphold the first ground of appeal.

Ground 2: Denial of procedural fairness

36 Having determined that it was open to the Council validly to impose condition 3(a) and that Cavasinni’s application for modification otherwise met the jurisdictional requirements of s 96(1A) of the EPA Act, the commissioner turned at [28] to consider the discretion conferred by s 96. Having considered the matters there identified, a single sentence conclusion is expressed in the next succeeding paragraph as follows

“[29] In the exercise of my discretion, I am not persuaded that the modification through deletion of condition 3(a) should be granted.”

37 It is clear that the conclusion succinctly expressed in [29] is founded upon the reasoning contained in [28]. It is the fact that such reasoning was employed, leading to the conclusion so expressed, that founds this ground of appeal.

38 Cavasinni accepts that, when determining an application for modification pursuant to s 96(1A) of the EPA Act, the consent authority, including the court on appeal made to it under s 96(6), exercises a discretionary power. However, its complaint in the present case is that the basis upon which the discretion was exercised by the commissioner was not a basis agitated by either party at the hearing and was not a basis identified by the commissioner prior to judgment as one which was considered appropriate to inform the exercise of discretion. In short, it submits that it was denied the opportunity to lead evidence and make submissions upon an issue fundamental to the determination of its appeal.

39 A failure to afford procedural fairness is an error of law (Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 239 at [20]). As was there observed, while a commissioner of the court is not bound to determine proceedings solely by reference to the issues tendered by the parties, if the determination is to be made by reference to matters beyond the issues identified or argued by the parties, then procedural fairness requires that the parties be given notice of those additional matters and afforded the opportunity to be heard upon them (see also Shao v Hornsby Shire Council [2001] NSWLEC 254; 116 LGERA 462; Design Power Associates Pty Ltd v Willoughby City Council [2005] NSWLEC 470; 148 LGERA 233). This ground of appeal is therefore one open to Cavasinni to agitate in accordance with the limited right of appeal contained in s 56A of the Court Act.

40 An analysis of the reasoning in [28] of the commissioner’s judgment reveals that the exercise of discretion was wholly founded upon what might compendiously be described as a ‘benefit/burden’ consideration. Reference is made in that paragraph to the present benefit which the site enjoys in having vehicular access available via Stein Lane, a benefit which has been enjoyed by reason of the gradual creation of rights of carriageway over properties located to the west of the site and “consequential” dedication of Stein Lane as a public road. Having recited these facts, the commissioner states:

“The context here is similar to that in Progress and Securities Pty Ltd v North Sydney Municipal Council (citation omitted) and Monaldo Pty Ltd v Baulkham Hills Shire Council (citation omitted); the applicant is in effect accepting the benefit of both the 1998 consent for use as a restaurant and the 2007 consent for the extension of the restaurant premises, while seeking to be relieved of the burden created by the imposition of condition 3(a).”

41 The judgment continues in [28] by observing that a condition requiring the creation of a right of carriageway has been a condition of consent since 1998; it repeats the observation directed to the gradual creation of rights of carriageway over land to the west leading to the extension of Stein Lane, as a public road, to the western boundary of the site. A change of ownership of the site having occurred in 2006 is acknowledged but the commissioner determined that “any purchaser of the property would have been on notice of the requirement for the creation of the right of carriageway by the terms of the consents issued in 1997 and 1998 and the notation on the s 149 certificate.”

42 None of these matters going to the exercise of discretion under s 96 were agitated before the commissioner. So much is conceded on behalf of the Council. Its statement of contentions (Exhibit 8) identified seven specific bases for refusal of the application, three of which were directed to the deletion of condition 3(a). Those contentions were expressed as follows:

“1. It is contended that the deletion of Condition 3(a) of Development Consent No. 512/2007, which requires the creation of a right-of-carriageway, would not result in an orderly development of Stein Lane in that the development would not allow for the proposed extension of Stein Lane and access to adjacent and adjoining properties.

6. It is contended that the proposed modifications to Development Consent No. 512/2007 fails to satisfy the objective of the Environmental Planning and Assessment Act, 1979 in that the development as modified, would fail to promote and coordinate of (sic) orderly and economic use and development of land

7. On the basis of the above contentions, it is contended that the proposed modifications to Development Consent No. 512/2007 is not considered to be in the public interest.”
None of these contentions could give rise to a consideration of the matters identified in [28] of the judgment as leading to the exercise of discretion to refuse Cavasinni’s application.

43 Further, it is not contended on behalf of the Council that the matters identified in [28] were raised by the commissioner at the hearing. Nonetheless, it submits that no error is disclosed because the factual matters to which the commissioner referred coupled with reference to the decisions in Progress and Securities and Monaldo was simply a “part of the reasoning process”. Moreover, the Council submits that no error is demonstrated because the commissioner simply referred to those cases as examples of the way in which issues similar to those arising in the present case had been addressed.

44 The submission made by the Council does not, with respect to it, address the issue raised by the ground of appeal. Cavasinni does not challenge the right of the commissioner to determine its appeal by reference to discretionary considerations but says, consistent with authority, that if the basis of determination reflected in [28] was to be relied upon, then the parties ought first to have been afforded the opportunity to address those matters. In my opinion, Cavassini is correct in so submitting.

45 The Council prays in aid the decision of the Court of Appeal in Segal v Waverley Council [2005] NSWCA 310 at [44]; 64 NSWLR 177 at 189. Accepting, as I do, the statements of principle that emerge from Segal, the principal contested issues which were required to be addressed in the present case must, relevantly, be found in the contentions which the parties agitated before the commissioner. From the Council’s perspective, the contentions are best understood by those which it identified in writing (Exhibit 8), the relevant provisions of which I have earlier identified. None of the three relevant contentions could logically have founded considerations in terms of those reflected in [28] of the judgment.

46 For these reasons, I am satisfied that Cavasinni was denied procedural fairness in the hearing before the commissioner arising from the failure to afford to it the opportunity to address the matters considered in [28] of the judgment. Those matters represented the sole basis upon which the conclusion expressed in [29] was founded. I therefore uphold this ground of appeal.

Ground 3: manifest unreasonableness

47 This ground of appeal was addressed, but shortly, in Cavassini’s written submissions. The submission seems to be that in the context of the findings of fact made by the commissioner, the failure to determine that condition 3(a) was invalid is “manifestly unreasonable” or “a decision that was manifestly illogical, lacking a basis in findings or inferences of fact supported by logical grounds”. The authority cited for the proposition is Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S 20/2002 [2003] HCA 30. However that case is one directed to a ground for judicial review of a determination rather than one directed to the determination of a “question of law”, as that expression is used in a statutory provision such as s 56A of the Court Act.

48 In oral submissions, this ground of appeal was only faintly argued. Ultimately it was acknowledged that to sustain the appeal on this ground would “break new ground in relation to 56A”. That concession was undoubtedly made in the context of the decision of the Court of Appeal in Azzopardi v Tasman UEB Industrial Ltd (1985) 4 NSWLR 139 at 146G and 156A. That decision binds me and I am in no position to make a decision contrary to it, even if I was minded so to do.

49 I reject this ground of appeal.

Disposition of the appeal

50 The matters to which Grounds 1 and 2 of the appeal were directed, were matters fundamental to the decision of the commissioner in refusing to uphold Cavasinni’s modification application as it related to condition 3(a). As such, the judgment should not stand (cf Plaintiff S157/2002 v Commonwealth of Australia [2003] HCA 2; 211 CLR 476).

51 Both parties have submitted that should I find, as I have, that the commissioner erred in upholding the validity of condition 3(a), then I should dispose of the appeal without the necessity to remit the matter to the commissioner for further consideration. They rely upon the decision of the Court of Appeal in Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; 156 LGERA 150. Regrettably, in the circumstances of this case, I find myself unable to accede to those submissions.

52 As I have earlier recorded, Cavasinni accepts that s 96 of the EPA Act confers a discretion upon the consent authority, including the court, when determining an application for modification of a development consent. Further, it accepts that it was open to the Commissioner to consider a ‘benefit/burden’ argument as part of the exercise of that discretion, provided it was afforded an opportunity to address it.

53 Accepting, for the present, that such considerations could inform the exercise of discretion, the judgment of Spigelman CJ (Mason P, Beazley, Giles and Ipp JJA agreeing) in Thaina Town makes clear (at [108]) that, save in the case of the costs discretion, the general exercise of discretion to grant a consent or “some other such matter calling for the formulation of an evaluative judgment” should only be exercised in an appeal constrained by provisions such as those in s 56A in “exceptional circumstances”. I do not find such circumstances to exist in the present case.

54 There were matters relevant to the exercise of discretion which were not addressed in the submissions of the parties. Those matters of relevance include:

(i) the scope of the discretion available under s 96, particularly in circumstances where the modification seeks deletion of a condition which has been imposed without power so to do;
(ii) the extent to which the ‘benefit/burden’ doctrine can inform the exercise of that discretion (see the observations of Cripps AJA (Spigelman CJ and Santow JA agreeing) in Fairfield City Council v N & S Olivieri Pty Ltd [2003] NSWCA 41 at [82] – [84] and also the observations of Jagot J in Arkibuilt Pty Ltd v Ku-ring-gai Council [2006] NSWLEC 502 at [69] – [70]; 148 LGERA 85).

Quite apart from the observations of Spigelman CJ in Thaina Town , it would be inappropriate to determine those matters in the context of this appeal. They are matters which should be left to the commissioner to consider following any further evidence and argument directed to them by the parties.

55 The orders that I make are therefore as follows:

1. Appeal allowed;
2. Set aside so much of the judgment of the commissioner as determined that condition 3(a) of the development consent granted by the respondent to the applicant on 22 October 2007 would not be deleted;
3. Remit the Class 1 appeal made to this Court pursuant to s 96(6) of the Environmental Planning and Assessment Act 1979, so far as it seeks the deletion of condition 3(a), for determination by the commissioner in accordance with this judgment;
4. The respondent Council is to pay the applicant’s costs of this appeal; and
5. Each party is to pay its costs of the hearing before the commissioner on 5 August 2009.