Chappel Investment Company Pty Ltd & Anor v City of Mitcham - [2009] SASC 23

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
THE CHAPPEL INVESTMENT COMPANY PTY LTD & THE SMALLACOMBE INVESTMENT COMPANY PTY LTD v THE CITY OF MITCHAM
[2009] SASC 23
Judgment of The Full Court
(The Honourable Chief Justice Doyle, The Honourable Justice White and The Honourable Justice Kourakis)
5 February 2009
ENVIRONMENT AND PLANNING - ENVIRONMENTAL PLANNING - DEVELOPMENT CONTROL - CONSENTS, APPROVALS AND PERMITS
Appeal against a decision of a single judge of the Supreme Court - appellants applied to the respondent for provisional development plan consent with respect to land situated in the residential (foothills) zone of that municipality - the respondent refused consent - the appellants appealed that refusal to the Environment, Resources and Development Court - Environment Court held that it had jurisdiction to hear the appeal - respondents appealed to a single judge of the Supreme Court against that finding - the single Judge set aside the Environment Court's finding that it had jurisdiction to hear the appeal - appellants appealed to the Full Court against that decision - whether the development proposed by the appellants is 'residential flat building' and thus properly classified as non-complying such that the appellants' appeal to the Environment Court is incompetent pursuant to s 35(4) of the Development Act 1993.
Held: The single Judge was correct in determining that the kind of development proposed by the appellants was a "residential flat building" and therefore non-complying even though it was also a "residential flat building" that would operate and function as a retirement village - appeal dismissed.
Development Act 1993 (SA) ss 3, 32, 35; Development Regulations 1993 (SA) reg 3, 16, sch1; Retirement Villages Act 1987 (SA), referred to.
Telstra Corporation Ltd v Corporation of the City of Mitcham (2001) 79 SASR 509, applied.
Compaction Application Tips Pty Ltd v Australian Waste Pty Ltd (2001) 80 SASR 435, distinguished.
City of Mitcham v The Chappel Investment Company Pty Ltd & The Smallacombe Investment Company Pty Ltd [2008] SASC 240; Chappel Smallacombe Joint Venture v City of Mitcham & Ors (No. 1) [2008] SAERDC 39, discussed.
Hawkesbury City Council v Sammut (2002) 119 LGERA 171; Egan v Hawkesbury City Council (1993) 79 LGERA 321; Elf Farm Supplies Pty Ltd v Hawkesbury City Council and another [1999] NSWLEC 261, considered.

THE CHAPPEL INVESTMENT COMPANY PTY LTD & THE SMALLACOMBE INVESTMENT COMPANY PTY LTD v THE CITY OF MITCHAM
[2009] SASC 23
FULL COURT: DOYLE CJ, WHITE AND KOURAKIS JJ

DOYLE CJ: I would dismiss the appeal. I agree with the reasons given by Kourakis J for so deciding.
WHITE J: I agree that the appeal should be dismissed. I agree with the reasons of Kourakis J.
KOURAKIS J:
Introduction
The appellants applied to the City of Mitcham (“Mitcham”) for provisional development plan consent with respect to land situated in the residential (foothills) zone of that municipality. Mitcham refused to give development approval. The appellants appealed against that refusal to the Environment, Resources and Development Court (“the Environment Court”). The Environment Court found that it had jurisdiction to hear the appellants’ appeal.[1] This is an appeal from the decision of Bleby J in which he set aside the finding of the Environment Court that it had jurisdiction.[2]
[1] Chappel Smallacombe Joint Venture v City of Mitcham & Ors (No. 1) [2008] SAERDC 39.
[2] City of Mitcham v The Chappel Investment Company Pty Ltd and The Smallacombe Investment Company Pty Ltd [2008] SASC 240.
The question that is determinative of the Environment Court’s jurisdiction is whether the development for which the appellants unsuccessfully sought approval from Mitcham is of a kind described as non-complying by the applicable part of the Mitcham (City) Development Plan (“the Development Plan”). If it is, the appellants’ appeal to the Environment Court against Mitcham’s refusal of consent is incompetent by reason of s 35(4) of the Development Act 1993 (“the Act”).
The nature of the development and the history of the appellants’ application for consent are conveniently summarised in the following paragraphs of the reasons for decision given by Bleby J:
The developer is a joint venture known as the Chappel Smallacombe Joint Venture. In its development application, the developer sought approval for the development, on a disused quarry site on the subject land, of buildings to be used as a retirement village. The development, as shown on the plans, has the following components:
a.     Manor House – 3 levels comprising 15 apartments and area for community facilities and management office;
b.     Read Homestead – 3 levels comprising 9 apartments;
c.     Fuller Homestead – 3 levels comprising 9 apartments;
d.     Blythewood Homestead – 3 levels comprising 9 apartments;
e.     Coach House – 3 levels comprising 9 apartments;
f.     Gate House – 3 levels comprising 15 apartments;
g.     Eleven Cottages – 5 duplex buildings comprising 2 dwellings each and one detached building comprising a single dwelling; and
h.     Associated earthworks, landscaping, internal road works and removal of 5 significant trees.
The plans show each of the 66 apartments and 11 cottages having its own living areas, bedrooms, kitchen, bathroom, laundry and lavatory. Each of the larger buildings is to have an underground car park, while the cottages are to have car parks individually accessed from the rear. The plans show a space, in Manor House, for a “community centre” but it seems that no specific community facilities have been planned.
The development application was filed in March 2003. A number of amendments were made to the plans before the application was determined. The Council did not classify the development application as non-complying; rather, it refused the application on its merits.
The developer appealed to the Environment Court against this refusal of consent. As a preliminary point, the Council argued that the appeal was incompetent because the proposed development included residential flat buildings and was therefore non-complying. Under s 35(4)(a) of the Development Act 1993 (SA), no appeal lies from a refusal of consent for a non-complying development. The Judge of the Environment Court considered that each of the buildings which comprised the proposed development, other than the single detached dwelling, did “technically” fall within the definition of “residential flat building” in Schedule 1 of the Development Regulations 1993. However, the Judge ultimately held that, as a matter of practical reality, the nature of the development was not a series of residential flat buildings, but instead was a retirement village.[3]
[3]    City of Mitcham v The Chappel Investment Company Pty Ltd and The Smallacombe Investment Company Pty Ltd [2008] SASC 240 at [5]-[8].
The legislation
The applicable provisions of the Act at the relevant time provided:
32—Development must be approved under this Act
Subject to this Act, no development may be undertaken unless the development is an approved development.
35—Special provisions relating to assessment against a Development Plan
(1)If a proposed development is of a kind described as a complying development under the regulations or the relevant Development Plan, the development must be granted a provisional development plan consent (subject to such conditions or exceptions as may be prescribed by the regulations or the relevant Development Plan). …
(2)Subject to subsection (1), a development that is assessed by a relevant authority as being seriously at variance with the relevant Development Plan must not be granted consent.
(3)A development that is of a kind described as a non complying development under the relevant Development Plan must not be granted a provisional development plan consent unless—
(a)where the relevant authority is the Development Assessment Commission—the Minister and, if the development is to be undertaken in the area of a council, that council, concur in the granting of the consent;
(b)in any other case—the Development Assessment Commission concurs in the granting of the consent. …
(4)If a development is of a kind described as a non complying development under the relevant Development Plan, no appeal lies against—
(a)a refusal of consent or concurrence under this Act at any stage in the process (including in the circumstances envisaged by section 39(4) and including without hearing (or further hearing) from the applicant); …
(5)A proposed development that does not fall into a category of development mentioned in a preceding subsection will be merit development (and any such development must be assessed on its merit taking into account the provisions of the relevant Development Plan).
Regulation 16(1) of the Development Regulations 1993 (“the Regulations”) provided at the relevant time:
If an application will require a relevant authority to assess a proposed development against the provision of a Development Plan, the relevant authority must determine the nature of the development, and proceed to deal with the application according to that determination.
The Development Plan
The kinds of developments that are non-complying are listed in that part of the Development Plan that applies to the Residential (Foothills) Zone. Included within that list is development described as “Residential Flat Building”. Regulation 3 of the Regulations provides that the terms set out in Sch 1 to the Regulations have the meaning assigned by that schedule when those terms are used in development plans, unless a contrary intention appears. The term Residential Flat Building is defined in Sch 1 to mean a single building in which there are two or more dwellings, but does not include a semi-detached dwelling, a row dwelling or a group dwelling. It is common ground that the proposed development is not a semi-detached dwelling, a row dwelling or a group dwelling. The term “dwelling” is also defined in the schedule to mean a building or part of a building used as a self-contained residence.
The term “retirement village” is not defined in Sch 1 to the Regulations or in the Development Plan itself.
Conflicting decisions and approaches
The essential reasoning of the Environment Court appears in the following paragraphs:
[21]Read Homestead, Fuller Homestead, Blythewood Homestead, Couch House, Manor House, Gate House and the Cottages which each contain 2 dwellings, all fall technically within the meaning of ‘residential flat building’ as defined in the Regulations.
[22]However, it does not follow that the development proposed is for the purposes of assessment, by its nature, a series or a number of residential flat buildings (with the exception of the single detached dwelling). The question is: As a matter of practical reality, what is the nature of the development?
[26]While it might be correct to say that the majority of the buildings proposed in the development constitute residential flat buildings as defined in the Regulations, a consideration of the development as a whole, strongly suggests that the proposed development is for a retirement village. The intention is to manage the entire development as a single entity. The living units, while self-contained and capable of being used independently, will be part of a ‘retirement village complex’ as defined by the Retirement Villages Act. The buildings will be part of a ‘retirement village scheme’ as defined under the Retirement Villages Act. That is the clear intention of the appellants. It is that which distinguishes the present proposal from the proposed development the subject of the judgment in Tarca (above).[4] (emphasis added)
[4] Chappel Smallacombe Joint Venture v City of Mitcham & Ors (No. 1) [2008] SAERDC 39 at [21], [22], [26].
On appeal to this court Bleby J identified the following error in the reasoning of the Environment Court:
In this case it was beyond argument that the buildings the subject of the development application, other than the single dwelling, each fell within the definition of residential flat building contained in the Regulations. Each was therefore, in the Zone in question, a non-complying development, notwithstanding that together they also comprised a retirement village as defined in the Retirement Villages Act.
In my opinion the Environment Court fell into error when, for the purpose of determining whether this was a non-complying development, it attempted to classify the development as a retirement village. The only relevant question was whether the development was or included a series of residential flat buildings.[5] (emphasis added)
[5] City of Mitcham v The Chappel Investment Company Pty Ltd and The Smallacombe Investment Company Pty Ltd [2008] SASC 240 at [31]-[32].
The issues
The burden of the appellants’ case is that Bleby J was wrong to commence the inquiry dictated by s 35(4) by asking first whether the development answered the description of any of the kinds of non-complying development listed in the relevant part of the Development Plan. The appellants argue that:
The correct jurisdictional question that should have been asked by the Court was ‘as a matter of practical reality what is the nature of the development?’
In answering that question the appellants contend that the proposed use of the buildings as a retirement village is determinative. The appellants submit that the direction in reg 16(1) that the relevant planning authority “determine the nature of the development” supports the approach for which they contend.
On the other hand, Mitcham submits that Bleby J did ask the relevant question. It denies that reg 16, which in its terms only binds planning authorities, affects, in any way, the issue arising under s 35(4) of the Act.
It can be seen from the reasons of the Environment Court and Bleby J, and from the submissions of the parties, that the legal principle which is in issue is the proper construction of s 35 of the Act. In particular, the appellants contend that s 35 of the Act requires proposed developments to be assigned a single character which determines whether it is a “kind described as” non-complying. On the other hand, Mitcham submits that it is sufficient for the purposes of s 35(4) of the Act that the development can be described as a kind of development that is non-complying, even though it can also be described in another way which is not a proscribed development.
For the reasons that follow, the submissions of Mitcham should be accepted. The relevant question is that identified by Bleby J: does the development include a series of Residential Flat Buildings?
Construction of s 35 of the Act
Section 35(4), in its terms, requires nothing more nor less than a comparison of the proposed development to the kinds of development described as non-complying by the Development Plan. If the proposed development fits the description of one or more of the non-complying developments, the Environment Court has no jurisdiction to hear an appeal from the decision of a planning authority which has refused consent. Conversely, if the proposed development fits one of the kinds of development listed as complying, then s 35(1) of the Act will apply and the planning authority must grant its consent even though the development may also be described in another way. If the development “does not fall” into either category, it must be subjected to a merit assessment in accordance with s 35(5). It follows, subject to one qualification to which I will refer shortly, that the question asked by Bleby J is derived from both the text and structure of s 35 of the Act.
The manifest purpose of s 35 of the Act also supports the approach taken by Bleby J. A particular kind of development will be listed as complying or non-complying on the basis of a decision to encourage or discourage developments of that kind. The planning reasons for including a kind of development as one or the other are unlikely to be materially affected merely because a development which falls within the kind prescribed might also attract a different description under the Development Plan. Indeed, as a matter of semantics it will almost always be possible to describe a development in a number of different ways. Only minor differences of emphasis in the purpose, operation or marketing of a development may allow it to be classified in a variety of ways, even though the actual use of the land is, for all practical purposes, the same.
The purpose behind denying a planning authority the power to refuse consent for a complying development would be frustrated if that authority could refuse planning approval for a proposed development that was of a kind listed as complying on the grounds that the development could also be described in a way that was not listed as a complying development. Similarly, developers could walk around the listing of an obnoxious form of development as non-complying if the proposed development could also be described as a kind of development that was not proscribed. The object of the Act to promote proper, orderly and efficient planning[6] would be frustrated if planning authorities were required to undertake semantic and metaphysical enquiries into the “true” character of proposed developments.
[6] Development Act 1993 s 3.
The appellants did not articulate any clear limit on where planning authorities or the courts could look to find legitimate alternative descriptions for developments. In this case the competing description was a form of development recognised in the Retirement Villages Act 1987. However, it is not clear to me why the construction and application of s 35 of the Act should be affected by quite unconnected legislation. It could not, for example, be suggested that the Act and the Retirement Villages Act 1987 should be read in pari materia. The appellants also referred to the use of the description “retirement villages” in other parts of the Development Plan and in the development plans of other municipalities. However, unless a development plan expressly, or by necessary implication, provides that a kind of development listed as complying or non-complying is to be understood as excluding developments of a kind mentioned elsewhere in the plan, there is no warrant in s 35 or any other provision of the Act to do so. It seems to me that the appellants’ approach necessarily leads to the position that if there is any form of words that better describes the proposed development than the descriptions of the prescribed complying and non-complying developments, then that development must be assessed pursuant to s 35(5) of the Act. That approach would frustrate the manifest purpose of s 35, which is to provide for a greater degree of certainty for prescribed developments than is the case for developments which are subject to a merits assessment pursuant to s 35(5) of the Act.
This very case illustrates the anomalies that would result from the appellants’ approach. The development here in question is, as a matter of ordinary language, likely to be referred to as a retirement village, because only aged people will be permitted to reside there and because the form of tenure offered on the “flats” is adapted to the financial and other circumstances of the aged. Those considerations can have no more than a marginal effect on the land use that is contemplated by the definition of “Residential Flat Building”. On the appellants’ approach, the occupancy of the dwellings the appellants intend to construct by single adults or families, by working people or by the unemployed is a non-complying use because the development would be a residential flat building and nothing else. However, if some medical and social support facilities are provided for occupants who are aged, refugees or paroled prisoners, the development would no longer be non-complying because it can be described, respectively, as a retirement village, immigration hostel or rehabilitation complex. There is nothing in the text or context of the Act or the Development Plan which would warrant such vastly different planning consequences when there is no material difference in the nature of the occupancy of the dwellings comprising the residential flat buildings. Neither the Act nor the Development Plan provide any objective criteria against which planning authorities and courts could determine whether the extra services that the developer intends to provide to people living in the flats have changed the true nature of the proposed development from a residential flat building to some other kind of development. Moreover, often the provision of extra services will exacerbate the very characteristics of a residential flat building that have resulted in its prescription as a non-complying use. The appellants’ formulation of the relevant question would have the planning tribunal and courts embark on a search for the “proper” description of proposed developments, which is not in anyway anchored to the principles and objectives of the development plan.

It is convenient here to refer to a qualification to the general approach I have described that does arise out of the structure of s 35 of the Act. Section 35 of the Act contemplates that development plans may prescribe some developments to be complying and others to be non-complying. The statutory provisions applying to those developments are mutually inconsistent. Theoretically, a proposed development might fall within the ordinary meaning of a kind of development listed as complying and within the ordinary meaning of another kind of development listed as non-complying. That is not this case. Nor is it likely to often arise because of the very different consequences of classifying a kind of development as one or the other. However, if a proposed development fell both within a kind of development that was complying and a kind that was non-complying, the question identified by Bleby J would not be sufficient to determine how that development should be dealt with.
Although this case does not directly raise the problem, it is necessary to explain why, in my view, it is not a reason to depart from the approach that I have just outlined. I think that the dilemma caused by a single development that appears to be both of a kind that is complying and a kind that is non-complying can be dealt with adequately in the following way. First, it would be necessary to consider whether there is a construction of the development plan that is capable of resolving the inconsistency. A proper construction of the development plan must necessarily proceed on the basis that it could not have been intended to classify a proposed development as both complying and non-complying. On that basis, it may be possible to read down the applicable kind of development in one list so that it does not extend to the developments of a kind that are described in the opposing list. If the contradiction cannot be resolved by construing the development plan in that way, it will be necessary to decide whether the proposed development is more appropriately characterised as a development of the complying or non-complying kind.
I accept that that process is similar to the approach that the appellants contend should be applied in all cases. There are however important differences. First, it is a very limited departure from the ordinary language of s 35 of the Act and it has a foundation in the text and structure of the legislation. Secondly, it is necessary to make s 35 of the Act work. Thirdly, it is an enquiry that remains anchored to the planning objectives of the Act. It involves a much more confined enquiry, limited as it is to a choice between the kinds of development listed as complying and non-complying by the development plan itself, rather than the wide-ranging search for the true character of a development for which the appellants contend.
The appellants’ contention that it is necessary to determine the single “true” nature of the development appears to have several foundations. First, it is said to be required by authority.
In Compaction Application Tips Pty Ltd and others v Australian Waste Pty Ltd and another[7] the Full Court accepted that a planning authority must “as a matter of practical reality, decide what the nature of the development is”.[8] However, the passages relied on must be read and understood in the context of the issue decided in that case. The developer in Compaction Application Tips had made four separate development applications for landfill operations on adjoining sites. Individually the proposed developments were not non-complying, but if the separately identified developments were, as a “matter of practical reality”, characterised as the one application, the development was non-complying because of the total tonnage of landfill involved. It follows that the decision in Compaction Application Tips has no direct application to this case.
[7] (2001) 80 SASR 435.
[8] Compaction Application Tips Pty Ltd v Australian Waste Pty Ltd (2001) 80 SASR 435 at 439, [10], 442 [18] and 444 [27].
It should not be thought that an assessment of the development as a matter of practical reality has no part in the application of s 35 of the Act. A realistic appraisal of what the development entails is as important in deciding whether it is complying or non-complying as it is when assessing its merits. That is, I think, just another way of emphasising that it is the substance of the development for which approval is sought that is important, and not the mere form of the application or applications. The following examples illustrate how a determination of whether a development is complying or non-complying also involves a practical and realistic assessment of what is proposed. An apartment block with a basement gymnasium cannot, as a matter of practical reality, be described as a gymnasium. The development is an apartment block. Equally, a large public gymnasium with several upstairs flats is not an apartment block, even if the residents are allowed free access to the gymnasium. The practical evaluation of a proposed development is an anterior issue to the one raised in this case. A planning authority can proceed to determine whether a proposed development is complying or non-complying and, if necessary, assess its merits against the objects and principles of the applicable development plan in a meaningful way, only after it has an understanding of what is proposed as a matter of practical reality.
The more directly relevant authority to the issue raised on this appeal is the decision of this Court in Telstra Corporation Ltd v Corporation of the City of Mitcham.[9] In that case the planning authority found that the proposed development was a “transmitting station” and therefore “non-complying”. Telstra contended that the development was more properly described as a “telecommunication station”, which was a kind of a development referred to in other parts of the relevant development plan. The Full Court held that the words “transmitting station” must, in the absence of a definition, be given their ordinary meaning. The Full Court held that on the ordinary meaning of those words, each description was capable of applying to Telstra’s proposed development, and that the development was therefore a “non-complying” use. The decision in Telstra Corporation therefore supports the decision reached by Bleby J.
[9] (2001) 79 SASR 509.
Next, the appellants rely on reg 16(1). For the reasons that follow, the appellant’s reliance on that provision is misplaced. First, it is, in its terms, directed to planning authorities that are required to assess a proposed development against the provision of a development plan. The Environment Court will also necessarily determine the correctness of a planning authority’s decision, should it be challenged on an appeal, by reference to that regulation. However, the regulation has no bearing on the question of the jurisdiction of the Environment Court under s 35(4) of the Act. Secondly, s 35(4) of the Act cannot be construed by reference to regulations made under the Act. On the contrary, the regulations must be given a construction that conforms with the Act. Thirdly, there is no reason to construe the direction in reg 16(1) to determine the nature of the development as a direction to give the development a single classification or description. A determination of the nature of the development is necessary so that the substance of the proposal can be practically and realistically understood. Fourthly, the merits assessment of a proposed development would, in some cases, be constrained if reg 16(1) were to be construed as requiring a planning authority to arrive at a single characterisation of the development that reflects its “true nature”. Regulation 16(1) cannot be given a differential operation that requires a single characterisation of a development for the purpose of determining whether it is complying or non-complying, and allows a more flexible approach for the purpose of merit assessment.
The reasons advanced by the appellants in favour of a single characterisation test are not persuasive and should be rejected.
Conclusion
I would hold that in the circumstances of this case Bleby J correctly identified the relevant question. The New South Wales Court of Appeal has adopted a similar approach to the provisions of the planning instruments of that State that proscribe certain forms of development.[10] Even the Environment Court Judge appears to have accepted that the development falls within the meaning of a residential flat building although she qualified her acceptance of that proposition with the word “technically”. Bleby J thought it beyond argument that the development was of a kind that was described as non-complying. In my view too, as a matter of ordinary language the proposed development was plainly a residential flat building, however else it might also be described. For the reasons that I have given, that factual finding is determinative of the jurisdictional question in this case.
[10] Hawkesbury City Council v Sammut (2002) 119 LGERA 171; Egan v Hawkesbury City Council (1993) 79 LGERA 321; Elf Farm Supplies Pty Ltd v Hawkesbury City Counciland another [1999] NSWLEC 261.
I would dismiss the appeal.